Information Systems Management Project_Final 2

8/2/2019 Information Systems Management Project_Final 2

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Information Systems Management Project

O

Cyber-laws: Issues for Global Economy (India Vs Globally)

Submitted to

Dr. Preeti Khanna

In partial fulfilment of the requirements of the course

Information Systems Management

By Group o. 9

1. Shrey Agarwal (D-2)2. Vinay Arun (D-6)3. Archana Ashar (D-7)4. Apar Bansal (D-11)5. JayKaran Singh Chadha (D-20)6. Deeksha igam (D-40)7. Shwetank Sharma (D-55)


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Table of Contents

Abstract ................................................................................................................................................... 4

1. Introduction ..................................................................................................................................... 5

a. Need for Cyber Laws .................................................................................................................. 5

b. Cyber Legislations Worldwide.................................................................................................... 5

c. Cyber Laws in India .................................................................................................................... 5

d. Digital Media Piracy ................................................................................................................... 6

e. Company Analyzed ..................................................................................................................... 6

2. Problem Statement .......................................................................................................................... 8

a. Indian Context ............................................................................................................................. 8

b. Understanding the Piracy Ecosystem .......................................................................................... 8

c. Factors Impacting Piracy: Global and Indian .............................................................................. 8

d. Effects of Piracy .......................................................................................................................... 9

3. As-Is To-Be Analysis .................................................................................................................... 10

4. Business Solution .......................................................................................................................... 11

a. Pre Crime Stage......................................................................................................................... 11

b. Crime Stage ............................................................................................................................... 12

c. Post Crime ................................................................................................................................. 14

5. Global Impact of Piracy ................................................................................................................ 15

6. SWOT Analysis............................................................................................................................. 17

a. STRENGTHS ............................................................................................................................ 17

b. WEAKNESS ............................................................................................................................. 18

c. OPPORTUNITY .......................................................................................................................18

d. THREATS ................................................................................................................................. 18

7. Challenges ..................................................................................................................................... 19

a. People ........................................................................................................................................ 19

b. Process....................................................................................................................................... 19

c. Technology................................................................................................................................ 19

8. Cost Benefit Analysis.................................................................................................................... 20

9. Actual Scenarios............................................................................................................................ 21

1. HADOPI (France) ..................................................................................................................... 21

2. BAIDU (The google of China).................................................................................................. 24

3. Facebook & Google: Internet Intermediaries under Indian Law............................................... 25

10. Future Scope & Conclusion ...................................................................................................... 28


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11. References ................................................................................................................................. 29

Figure A How piracy works ...................................................................................................................... 9

Figure B Business Solution ................................................................................................................... 11Figure C Growth of subscriptions .......................................................................................................... 12

Figure D Source: SSKI Media Research, 2007 ........................................................................................ 20

Figure E Reduction in P2P use ............................................................................................................... 23

Figure F India's potential .......................................................................................................................26


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Abstract

The Information Technology age has led to the emergence of a dynamic and highly

specialized field of law, namely Cyber laws. The unique features of the internet,

particularly, its borderless expanse, rapid technological advancements, anonymity, speed ofcommunication & data transfer have posed multiple challenges to legislators of different

countries who strive to adapt their existing laws for application in cyberspace or develop

new laws to govern the virtual world.

In this report, we analyze the cyber laws from a global perspective particularly in the digital

media sector.

The digital music sector is pushing the limits of consumer choice, extending its business

models and reaching out to consumers across the globe. Digital channels have overtaken

physical formats to become the dominant revenue stream in the worlds largest market, the

US. The digital music market is poised to further expand its reach internationally in 2012.

Despite the big steps forward of 2011, digital piracy remains a critical barrier to growth and

investment by record companies. More than a quarter of internet users globally (28 per cent)

access unauthorized services on a monthly basis, according to IFPI/Nielsen.

The report also deals with the battle against digital media piracy and the various cyber laws

and business solutions that exist to deal with this issue.

Cooperation from a far wider circle of technology and business partners, from advertisers to

search engines, is now needed to deal with the problem of piracy.


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1. Introductiona. eed for Cyber LawsThe expression Cyber laws encompasses the legal matrix of cases, statutes, regulations &

legal principles that affect persons and institutions to control entry to cyberspace, provide

such access, use this space and create hardware and software which enable people to go

online to experience this world. To put it simply, Cyber laws constitutes rules and regulations

that govern the cyberspace.

The rapid development of Internet and Computer technology globally has led to the growth of

new forms of transnational crime especially Internet related. These crimes have virtually no

boundaries and may affect any country across the globe. Thus, there is a need for awarenessand enactment of necessary legislation in all countries for the prevention of computer related

crime. Territorially based law-making and law-enforcing authorities find this new

environment deeply threatening.

b. Cyber Legislations WorldwideTo meet the challenge posed by new kinds of crime made possible by computer technology

including telecommunication, many countries have also reviewed their respective domestic

criminal laws so as to prevent computer related crimes. Some of these countries are USA,

Austria, Denmark, France Germany, Greece, Finland, Italy, Turkey, Sweden, Switzerland,

Australia, Canada, India, Japan, Spain, Portugal, UK, Malaysia and Singapore. However, no

country has fully resolved all the issues such as legal, enforcement and prevention of crime.

The legislations enacted by different countries cover only few of the classified computer-

related offences. However, looking to the dynamic and fast changing technology, new types

of offences may pop-up frequently.

c. Cyber Laws in IndiaKeeping in line with other countries, India also has passed its first cyber law, The

Information Technology Act 2000, which aims to provide the legal backbone for enabling e-

commerce in the country. However the arrival of Internet resulted in the rise of new and

complex legal issues. Though India has a detailed and well-defined legal system in place, but

at the time of enactment of Indian laws nobody could really visualize about the Internet. We

must remember that all the existing laws in place in India were enacted keeping in mind the

relevant political, social, economic, and cultural scenario of the corresponding time. As like


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the rest of the world, the existing laws of India also could not handle the various cyber space

activities. As such the need arose for a Cyber Law.

d. Digital Media PiracyThe Media and Entertainment (M&E) business in India is one of the fastest growing

segments of the economy. It is a US$ 11 bn industry growing at a CAGR of 18%. The

industry landscape is now undergoing a significant shift. Cable digitization, the promise of

wireless broadband, increasing DTH penetration, digitization of film distribution, growing

internet use are all prompting strategic shifts in the way companies work. Traditional

business models are evolving for the better as a host of new opportunities emerge.

However, widespread piracy is the biggest factor undermining the growth of the digital music

business. Worldwide, the industry federation says, 95 percent of the music downloaded via the

Internet is pirated.

The battle against online piracy, or at least electronic piracy, has been going on since before there

was an Internet, with early software manufacturers attempting novel security features to stop

people from making illegal copies of their software.

Neither piracy, nor the fight against it seems likely to go away anytime soon. Security measures

continue to be developed, as do the techniques used to break them, and distribute copyrighted

material freely.

The international nature of piracy, and the fact that different countries have very different laws

about it, is another factor complicating the issue as a whole.

e. Company AnalyzedUTV Software Communications Ltd (UTV), India's first integrated global media and

entertainment Company, has seen recent expansion, both in existing businesses and into new

growth sectors. The entire UTV focus is on creating, aggregating and disseminating outstanding


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content. UTV is a diversified media and entertainment company with content creation abilities

across platforms and genres.

The company has acquired a controlling stake of 76 percent amounting to Rs.150 million in IT

Nation, India's leading online infomediary that focuses on technology markets, covering

enterprises, technology resellers and general consumers.

The company plans to invest around Rs.1.2 billion over the next two years to create a

combination of Internet space with a portfolio of 10 portals targeted at specific need groups.

UTV

VerticalsBroadcasting

Games

Content

Motion

Pictures

Interactive

TV Content


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2. Problem Statementa. Indian ContextIndia is well behind the curve

P2P sites, like DesiTorrents,

outside India, conferring so

enforcement efforts of Indian

adherence to prevent piracy in

b. Understanding the Pir

c. Factors Impacting Pir

Market Need

Accessibilit

Product Pric

when it comes to fighting digital piracy. No

CTorrent, have been filed till date. Infringi

e protection from the relatively disorga

rights holders. The problem: How can India

the media sector and generate the revenue l

cy Ecosystem

cy: Global and Indian

Factors Impacting

Piracy

y

ing

Business

Environment

Profitability

Technology

Ease of Content

Acquisition

Industry Support

Political &

Regulatory

Legal Framework

Law Enforcement

Lack of C

Awar

8

uits against Indian

ng sites are hosted

ized international

enforce copyrights

st to piracy?

nsumer

ness


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d. Effects of Piracy

Figure A How piracy works

9


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3. As-Is To-Be Analysis

STAKEHOLDER AS-IS(IDIA)TO-BE

(IDIA)

EXAMPLE

(GLOBAL)

Websites

Search engines arelinked to unauthorisedcontent or sites whichregularly infringecopyright

Search engines shouldlink to legal music

Jan 2011, rightsholders in the UK werein discussions with thegovt. and searchengines on a draft codeof conduct forprioritization of legalsites in search results& online advertising

Payment ProvidersNo action againstIllegal Sites

Payment providersneed to act on illegal

sites

A partnership betweenIFPI, the City ofLondon Police andpayment providers hasprevented 62 illegalwebsites in Russia andUkraine from abusingpayment since March2011

Hosting Providers

Enable websites to

illegally distributecopyrighted material

Need to block illegal

distribution ofcopyrighted content

In May 2011, a courtin Luxembourg ruledagainst a leading

hosting provider forproviding services toillegal websites

Consumers Low AwarenessMore consumer

awareness and actionneeds to be taken

IFPI works with itsmember labels toprevent leaksoccurring, improvingsecurity of promotionalcopies of new music,and if a leak happens,it removes the

infringing links online.In 2011, it removed >15 million tracks.

Government

In spite of The IndianInformationTechnology Act andother initiatives takenup by individual states,no strict l legalframework or

enforcement iscurrently happening

Urgent need tostrengthen Indian

Copyright and cyberlaw enforcement

Fear of the law of theland is the mosteffective tool to fightpiracy. Singapore, inspite of its proximity toMalaysia, has piracylevels at 30%, due toits robust legal

framework and nocorruption.


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4. Business SolutionThe biggest crisis that media companies face today and that can be addressed by an effective

legal structure is the piracy issue.

Piracy can be viewed as a combination of two problems; a social problem and a technological

problem. The social problem primarily gives rise to the belief that it is acceptable to

download content for free when it is easily available. The technological problem gives rise to

the ease and anonymity that pirates use to carry out pirate activities.

Hence, a solution has to be a multi-pronged approach and it is seen that such approaches have

worked1. The solution proposed here takes into account all the stakeholders that are affected

by the piracy issue.

The problem has been identified to be occurring in three stages. Pre-crime involves activities

that enable the facilitation of piracy. The crime stage is the carrying out of the act and the

post-crime stage is where prosecution and follow up occurs.

Figure B Business Solution

a. Pre Crime StageIn the pre-crime stage the major stakeholders are the players in the media sector and the

government. Ineffective cyber laws can facilitate creation of channels to create and deliver

1Piracy: improved cooperation from online intermediaries by Paul McGuinness, manager, U2

Blueprint to fight piracy in the media sector

Stakeholders involved Techniques used Actions performed

Legal Department

ISPs

Government/Legal

Payment Gateways

Artists, Publishers &

Search engines

(Monitoring and Reporting)

Music Industry

(Awareness and Education)Legitimate services

Website

Blocking

Graduated

Response

Awareness

Campaigns

Legal

Prosecution Sanctions

On transactions

Prosecution andrights

enforcement

Review and

update lawsthat enable

criminalisatio

n of piracy

Database

of violators

maintained

ISPs to monitor

and warninfringing

subscribers

Increase

consumerawareness.Provide legitimate

alternatives

Artists/publishers

to provide infringerdetails to ISPs for

action


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pirated content. The solution

stakeholders. The governmen

must emphasis the availabili

These are continuous proce

performed. As technology ch

been seen that nations that ha

b. Crime StageThe crime stage is when the

information sharing has ma

networks (Peer-to-Peer). A

This scale makes it very di

techniques that have shown pr

Graduated ResponseThis is carried out by the IS

which are downloading ille

subscriber list to identify the s

that informs the subscriber o

calls are repeated. The subsc

can also throttle the bandwi

inform the concerned authori

privacy of the subscriber.

2Digital Music Report 2012, IFPI

roposes at this stage to carry out awareness

should emphasis the illegality of piracy an

y of legitimate sources through these awa

s and the activities column describes h

nges both laws and services to consumers

e implemented such an approach have seen

Figure C Growth of subscriptions

act of piracy actually takes place. The in

e it very easy to propagate piracy espec

ajor problem has been the scale to which

ficult to deal with piracy. The solution pr

ogress in the countries where they have been

(Internet Service Provider). The ISP ide

al content. This IP address is then mapp

ubscriber. The ISP then calls the subscriber

the illegality of the usage. If violation is

iber is made aware of the possibility of pr

th to the subscriber. If no improvement is

ties. All these activities are performed wit

12

campaigns by both

the media players

reness campaigns.

w this has to be

ust keep up. It has

ositive results2.

ternet and ease of

ially through P2P

iracy takes place.

poses to use two

implemented.

tifies IP addresses

ed with the ISPs

ith a first warning

bserved again the

secution. The ISP

seen the ISP will

due regard to the


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In Germany, 81 per cent of

warnings with the prospect

(GfK, February 2011).

In South Korea, government

activity on receipt of a first n

with 70 per cent of users ceasi

Website BlockingAlong with the graduated res

has also shown to be effective

In Belgium, in September 20

Telenet to block access to T

from comScore shows that thi

and November 2011. In Ital

February 2010 - at the time,

passed, usage of the servi

(IFPI/Nielsen).

The website blocking techniq

that illegally distribute conte

3Digital Music Report 2012, IFPI

Consumer

heedgraduatedresponse:Ipsos MediaCTfindings in New

Zealand (Augus2011)

consumers that download media content ill

f consequences would make people stop t

officials report that 70 per cent of infringi

tice. A similar pattern is found on receipt o

ng to use their account to infringe.3

onse technique, scanning and blocking qu

in countries that have used the technique.

11, the Antwerp Court of Appeal ordered I

e Pirate Bay by way of domain name serv

s reduced the services audience by 84 per c

y, ISPs were ordered to block access to

the biggest torrent site in Italy. Once the

e fell dramatically and it is still down

e requires that the internet is scanned for qu

t. It is known that most search engines rea

Half of all online adults aged 15-50 agree thinternet suspension or fines for repeatedlydownloading content without the copyright

permission are acceptable

Although the law was not yet in place, 14 peof P2P users aware of it claimed their behavhad already changed

Most P2P users that had already changed thbehaviour as a result of the law (62%) avoidparticular unauthorised services altogether

New legal measures have the ability to signiimpact P2P as seven in ten users claim theystop on receipt of a notification with a sanctiattached

13

egally believe that

eir illegal activity

g users stop their

the second notice,

stionable websites

Ps Belgacom and

ice blocking. Data

nt between August

he Pirate Bay in

locking order was

by 74 per cent

stionable websites

ily yield results of

t

wners

r centour

ir

icantlyould

on


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these websites if searched for, hence search engines can be used as a way of finding such

sites. The trick however is to involve multiple stakeholders. Apart from the ISPs, artists and

media distributors must also be able to play a role in scanning through a complaint

mechanism. Search engines can and should play a big role here by not featuring illegal

websites as search results.

Harris Interactive found that 23 per cent of consumers regularly download music illegally

using Google as their means to find the content (September 2010). Further research in New

Zealand by Ipsos MediaCT (August 2011) also highlighted that search engines direct a

significant number of users to unauthorised sources. 54 per cent of users of unauthorised

downloads said they found the music through a search engine. In Ireland, this figure was 49

per cent (Ipsos MediaCT, October 2011). A law that mandates responsible behavior on part

of search engines will be very effective in blocking out illegal websites.

It is also recommended in this solution that a database of violators be maintained to identify

repeat violators and take quick action. This database should ideally be at the ISP level with a

protocol in place for prosecutors to have access as the need arises.

c. Post CrimeOnce crime has been established and identified, laws must be in place to be able to quickly

prosecute the violators. Special courts can help with this regard. Payment gateways like

VISA, MasterCard etc. must deny services to accused entities, this can go a long way in

hampering the activities of pirates. Advertising is also a beg source of revenue for pirates.

Advertisers must also refuse to advertise with such websites.

Web hosting providers must also play a role in the post-crime scene by pulling down

websites of violators.

With such a comprehensive situation in place the legitimate media industry can successfully

fight piracy. It will need a continuous process and the first few stages of implementation will

see illegal sites shut down and new ones mushrooming, but this is not sustainable in the long

run. Eventually piracy will be reduced to a great deal using such an approach.


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5. Global Impact of Piracy Brazil: One billion tracks were downloaded or swapped illegally on the internet in Brazil

last year, while the physical piracy rate was 40 per cent. It is hardly surprising against

such a backdrop that the music industry has lost 80,000 jobs in the country since 1997.There are signs though that the newly formed National Anti-Piracy Council is starting to

make an impact.

Canada: Outdated copyright laws have helped digital piracy flourish, with over onebillion songs being downloaded illegally in 2005. The previous government failed to

fulfill its long-standing pledge to ratify the 1996 WIPO Treaties. Annual retail sales of

music fell by 42 per cent 1999-2005 and 20 per cent of music industry jobs have been

lost. It is hoped the new government will take intellectual property more seriously.

China: The largest producer of pirate discs in the world with a physical piracy rate ofover 85 per cent. The country also has 64 million broadband lines which is facilitating a

rapid growth in digital piracy in a culture where paying little or nothing for music is

ingrained. The government has made positive noises about protecting intellectual

property but they need to be translated into hard action.

Greece: With a physical piracy rate of 50 per cent and legal sales falling by a fifth in thepast five years, Greece is a new priority country and one of three priority countries inside

the EU. The judicial system is weak and the Fiscal Police remain largely inactive in the

fight against piracy.

Indonesia: A major source of imported pirate discs in Australia, Indonesia has failed tocontrol its optical disc plants. There are more than 40 plants in the country and half of

them are not even registered with the Ministry of Industry as required. An Intellectual

Property Taskforce was established in March 2006 and it is hoped this may lead to a

coordinated response to enforcement that has so far been lacking.

Italy: Italy is one of the biggest sources of piracy in Western Europe. Organized crimenetworks are playing an ever-increasing role in the black market trade in music. The

governments recent anti-piracy laws and increased police action may help, but theproblem is so big it will need a concerted and continuing campaign to have any effect. At


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the same time, the country also has a developing digital piracy problem with 2.7 million

illegal music file-sharers.

Mexico: There were nearly 110 million physical pirate products sold in Mexico last year.Digital piracy is also beginning to take-off with more than 570 million tracks being

downloaded or swapped illegally in 2005. The authorities have been working with the

industry to tackle physical piracy, but a more sustained and widespread approach is

needed.

Russia: One of the major sources of pirate discs found across Europe, Russia has alamentable record of prosecuting the criminals behind this trade with only one in four

cases resulting in a prosecution. At the same time, the country is host to a large number

of copyright infringing websites, such as allofmp3.com, which sell music around the

world without the permission of or payment to rights holders.

South Korea: Internet piracy is rife in South Korea so it is not surprising that revenuesfrom legal music sales have halved in five years. New technology has enabled the

establishment of digital broadcasting services that transmit high-quality music videos to

mobile phones via satellite without the rights holders permission. The governments anti-

piracy campaigns remain sporadic due to the lack of a centrally coordinated enforcement

agency.

Spain: Major police actions have led to a small significant reduction in physical piracy,although the rate remains unacceptably high (22%) for the sixth consecutive year. Internet

piracy is beginning to take off however with nearly 500 million tracks downloaded

illegally in Spain last year. The Spanish government needs to close loopholes in its anti-

piracy laws to take action against digital piracy.


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6. SWOT AnalysisAfter looking at various steps taken by companies and governments in various countries this

solution has been proposed.

a. STREGTHS The solution takes the positive part and tries to minimize the negative impact The solution is more progressive in nature:

o It talks about educating the consumers. Companies want the piracy to bereduced but they also dont want to lose the customers. So by educating them

about the lawsuits and advantages of using services from legal websites it is

helping the music industry as well as consumer. Consumer will be more aware

of their action and know about the consequences because in most cases they

dont know that they are breaking law. Consumer will get better product and

services. Companies will get more revenue and will look to improve their

services

Working in collaboration with government:o Government needs to play the part in controlling piracy at each stage. Due to

piracy government is also losing revenue. Since downloading from illegal sites

results in only black money. The owner of the illegal sites doesnt pay anytaxes

Forcing ISP to maintain database:o The following step helps in tracking the people who are doing illegal

activities. Till date ISPs have been protecting their customer. But by

including the ISPs in the cost structure of system and forcing ISPs in

implementing in second stage will significantly reduce piracy

Solution is in sync with worldwide measures that are being taken

Sharing of information between various players in the industry would go a long wayin consolidating and replicating successful initiatives, which would benefit all players

in the long run. As an illustrative, the Andhra Pradesh Film Chamber of Commerce

has created an Anti-Video Piracy (AVP) cell since May 2005. This dedicated cell led

by a retired SP of the state(currently led by Mr. Keshava Reddy) along with 59 other

retired police officers works in tandem with the Government and the law enforcement

agencies to fight piracy


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b. WEAKESS Solution wants partnership between company, government, ISPs and customers. If

any of them doesnt perform its duties then the solution may not be effective

Cyber laws are not uniform throughout the world so it is difficult to catch hold ofwebsite owner outside the country. Only way block the website

New ventures or startup have to bear the cost of the solution. Majority part (75%)ofthe cost they have to give in the initial stage when they are just starting. This makes

the venture more expensive

IT infrastructure cost of ISP increases and their liability also increasesc. OPPORTUITY

The solution has a scope of improvement

With time it is needed to give better IT infrastructure to agencies monitoring piracy.They needed regular investment in R&D for improvement in technology. Today DRM

is available as one form of technology but it increases cost of product substantially

Government needs to keep assessing the Cyber law. And add new features ifconditions of market demand. Implementation of the law is more important than just

laying down them and has to constantly invest in infrastructure so as the solution

works

d. THREATS People involved in illegal works will try to find other ways to do piracy. They will try

to find loopholes in the system and exploit them for their gain


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7. Challengesa. PeopleThe biggest challenge is the people themselves. They need to realize the loss due to piracy.

The loss is both in terms of monetary as well as creativity. Educating people about the benefit

of using services that are legal is important.

The real challenge for the local legislators will be to protect the intellectual property by

introducing reasonable remedies and proportionate measures. The goal should be to strike a

balance between the fundamental rights involved (privacy, freedom of expression, etc.) and

in general to adopt a prudent strategy which takes into consideration the different interests of

all the parties involved: content industry, ISP, search engines, payment providers, end users,

etc.

b. ProcessIt will also be crucial to support education programs finalized to promote the respect of

intellectual property rights which often are not perceived as a product of an industry but as a

good infinitely available and transferable without any particular restraint or fee. Making

people realize downloading from illegal sites is equivalent to stealing will be a challenge.

The engagement between stakeholders mentioned in the solution will have to be streamlined

through a predetermined process with everyones signoff.

c. TechnologyStakeholders like search engines, ISPs and legitimate service providers have a huge role to

play. As pirates find newer and cleverer ways of pirating, content technology must keep pace

and be able to track and block such illegal services. Technology must be able to address the

anonymity of P2P networks that are today the biggest platform for pirated content.

The sharing of technological resources among the stakeholders is of importance if a database

of repeat offenders is to be maintained which is an integral part of the solution proposed.


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8. Cost Benefit AnalysisIndia is one of the top countries in the world facing a threat, with the music industry losing

between US$600 billion and US$650 billion a year due to piracy. 64% of all music which is

downloaded is illegal and even though the Indian government is making serious efforts tocounter this intellectual property theft, the lack of proper patent laws or more correctly, the

enforcement of these laws allow the perpetrators of this crime to get away scot-free. Due to

this rampant piracy, the government is deprived of tax revenues, jobs are lost and research

and innovation never takes place.

Figure D Source: SSKI Media Research, 2007

(Figures in IR million)

Source: UTV financial statementsAssumptions:

1. 65% of the 38% loss in the industry is been assumed to be recoverable2. Awareness campaigns assumed to cost 5% of incremental PAT3. Monitoring cost is of 3 employees at a salary of Rs. 30,000 per month4. Infrastructure cost Rs 25 lakhs5. Miscellaneous cost Rs 10 lakhs


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9. Actual Scenarios1. HADOPI (France)Situation Overview

France became the first country in Europe to introduce graduated response legislation. The

Creation and Internet law established a new agency, HADOPI, which sends notices to

internet subscribers whose accounts have been used to infringe copyright. If a subscriber

ignores two notices within six months and infringes copyright law for the third time in a year,

HADOPI can notify a criminal court, which can suspend the internet account for up to a

month and levy a fine of up to 1,500. To date there have been more than 700,000 notices

sent, which IFPI estimates to have reached around 10 per cent of P2P users in France.

Details of law

HADOPI -Government agencyThe law creates a government agency called HADOPI (High Authority for Transmission of

Creative Works and Copyright Protection on the Internet). The agency is vested with the

power to police Internet users and is headed by a board of nine members. The composition

includes:

3 members appointed by the government 2 members by the legislative bodies 3 members by judicial bodies 1 member appointed by the Superior Council of Artistic and Literary Property 1 government council responsible to the French Ministry of Culture

GoalTo ensure that internet subscribers "screen their internet connections in order to prevent the

exchange of copyrighted material without prior agreement from the copyright holders"

Law EnforcementOn receipt of a complaint from a copyright holder or representative, HADOPI may initiate a

'three-strike' procedure:


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An email message is sent to the offending internet access subscriber, derived from the IPaddress involved in the claim. The email specifies the time of the claim but neither the

object of the claim nor the identity of the claimant. The ISP is then required to monitor

the subject internet connection. In addition, the internet access subscriber is invited to

install a filter on his internet connection. If, in the 6 months following the first step, a

repeat offense is suspected by the copyright holder, his representative, the ISP or

HADOPI, the second step of the procedure is invoked.

A certified letter is sent to the offending internet access subscriber with similar content tothe originating email message. In the event that the offender fails to comply during the

year following the reception of the certified letter, and upon accusation of repeated

offenses by the copyright holder, a representative, the ISP or HADOPI, the third step of

the procedure is invoked.

The ISP is required to suspend internet access for the offending internet connection, thatwhich is the subject of the claim, for a specified period of from two months to one year.

The internet access subscriber is blacklisted and other ISPs are prohibited from providing

an internet connection to the blacklisted subscriber. The service suspension does not,

however, interrupt billing, and the offending subscriber is liable to meet any charges or

costs resulting from the service termination. Appeal to a court is possible only during the

third phase of the action (after the blocking of internet access) and an appeal can result in

shortening but not cancellation of the blocking. The burden of proof is on the appellant.

Stakeholders involved

Stakeholders

P2P users

ISPs

Entertainment

industry

Copyright

owners

Consumer

associations

French

Government

(HADOPI)


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Impact & Benefits To date there hav

have reached arou

A separate study bcent of P2P users

infringing if they

graduated respons

Half of P2P usersimpact on their ill

There are good inyear of operation.

with overall P2P

October 2010 (IFP

number of infringi

shows a dramatic

piracy has seen a s

Approximately onnew law has or wil

been more than 700,000 notices sent, whic

d 10 per cent of P2P users in France

y Ipsos MediaCT, conducted in November

in France were aware of the law and 71 p

received a notification with potential sanct

programme

aged 15 to 50 (48%) claim the law has or w

gal behaviour.

ications of the impact HADOPI has had o

The use of unauthorized P2P networks ha

use down by 26 per cent since notices sta

I/Nielsen). According to Peer Media Techn

ng movie downloads initiated on P2P netw

decline since notices started, supporting

ignificant drop.

in six P2P users (16%), around one millio

l encourage them to use legal services more.

Figure E Reduction in P2P use

23

IFPI estimates to

011, found 90 per

r cent would stop

ons as part of the

ill have a deterrent

piracy in its first

sharply declined,

rted being sent in

logies, data on the

rks in France also

he view that P2P

people, claim the


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A study commissioned by HADOPI in May 2011 found that among those whohad either received a notice or knew someone who had received one, 50 per cent

said knowledge or receipt of a notice made them stop their illegal activity and a

further 22 per cent said it reduced their illegal consumption. Source: The Effect of

Graduated Response Anti-Piracy Laws on Music Sales:Evidence from an Event Study in France. (Figures are rounded).

2. BAIDU (The google of China) Situation OverviewChina, was a market with huge potential for the music industry. Yet it had suffered from anestimated 99% digital piracy rate in recent years, meaning the legitimate market had operated

at only a fraction of its true potential. China had nearly twice as many internet users as the

US, but digital music revenues per user were about 1% of that of the US. More than 70% of

music sales in China are digital, but the market had achieved a tiny fraction of its potential. In

2010, Chinas overall music sales were worth only US$67 million, making it a smaller

market than Ireland. BAIDU is a Chinese web Services Company headquartered in Beijing,

People's Republic of China. BAIDU provides an index of over 740 million web pages,80 million images and offers multimedia content including MP3 music and movies.

SolutionIn July 2011, BAIDU, Chinas largest search engine created a milestone in the music

industrys development in China by striking a partnership with One Stop China - a joint

venture between 3 major record companies

Universal Music Group Sony BMG Warner Music Group


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Stakeholders Involved

Impact & Benefits This deal connected One-Stop's world-class repertoire of licensed music to a

massive audience, creating crucial new opportunities for artists

BAIDU had agreed to remove all its infringing deep links to music belonging toany of the One-Stop China labels

The deal would allow China-based web users to legally download and streamhundreds of thousands of songs for free

Under the agreement, BAIDU would pay a fee to the music labels each time asong is downloaded or streamed

BAIDU would remunerate music content owners on a per-play and per-downloadbasis for all tracks delivered through the BAIDU MP3 Search service

It allowed consumers to download tracks for free from Ting, a new legitimateservice supported by advertising revenues

It allowed the labels to license 500,000 songs, 10 percent of which will be inMandarin and Cantonese

3. Facebook & Google: Internet Intermediaries under Indian Law Situation Overview

Digital ad spending reached $291 million in India last year, compared with $7.4 billion inChina and $32.2 billion in the U.S. TV and newspapers in India receive more than 80% of ad

Stakeholders

Chinese

Music

industry

Digital

music

buyers

BAIDU

One

Stop

China


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spending, while digital services get less than 5%. But India's nascent Internet industry could

generate 1.5 million jobs and $45 billion in wealth for investors in the next few years if

companies aren't bogged down in litigation.

Google Inc. and Facebook Inc., the social-networking giants are set to begin trial in March,

2012 to face charges that they hosted material that "seeks to create enmity, hatred and

communal violence" and "will corrupt minds." The complaint refers to obscene content and

material that depicted Hindu, Muslim and Christian religious figures in a mocking or

offensive manner putting on stark display the legal risks for Internet companies chasing

growth in India. These companies are Internet intermediaries as per the provisions of

Information Technology Act 2000 (IT Act 2000).

IssuesInformation Technology Act of 2008 states that intermediaries like blog-hosting platforms

and social networks are protected from liability for hosting prohibited content created by

their users as long as they remove or disable access to this content within 36 hours of

acquiring actual knowledge that it is accessible via their sites or services. The rules further

state that actual knowledge can be acquired through self-investigation or notification

submitted by others.

Impact India's nascent Internet industry could generate 1.5 million jobs and $45 billion in

wealth for investors in the next few years if companies aren't bogged down in

litigation

Figure F India's potential


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Stepped-up regulation of social networking is seen as a particular threat to India'sWeb growth which is the biggest driver of Internet adoption in India

It might propel India to follow Chinas example in blocking citizens access toFacebook that would amount to one third of the world blocking access to the

social network

Suggestions All subsidiary/Joint ventures companies operating in India that deal in information

technology and online environment, must mandatorily establish a server in India.

Otherwise, such companies and their websites should not be allowed to operate in

India

A stringent liability for Indian subsidiaries dealing in information technology andonline environment must be established by laws of India

More stringent online advertisement and e-commerce provisions must beformulated for Indian subsidiary companies and their websites


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10.Future Scope & ConclusionCyber crime ranks among the top 4 economic crimes of the world and is third on the list of

economic crimes in India. However, it is not going to be curbed that easily due to lack of

technological infrastructural support and weak cyber laws prevalent in India. In fact, it ishighly likely that cyber crime and its perpetrators will continue developing and upgrading to

stay ahead of the law. The risks of cyber crime are very real and too ominous to be

ignored. The real reason why so many youths are attracted to the world of cybercrimes is the

lack of transparency regarding this issue.

The digital media sector particularly is largely affected due to lack of stringent regulations

and policies in the cyber crime domain. The Indian media industry industry needs to act as a

facilitator and coordinator of anti-piracy efforts and Every franchisor and licensor, indeed

every business owner, has to face up to their vulnerability and do something about it. Further,

sharing of information between various players in the industry would go a long way

in consolidating and replicating successful initiatives, which would benefit all players in the

long run. All stakeholders need to be educated and involved to fight cyber crime and a

professional analysis of their cyber security and cyber risk needs to take place.

The media industry in collaboration with the government needs to replicate the successful

global models and engage in a prophylactic plan to minimize the liability; insure against

losses to the greatest extent possible; and implement and promote a well-thought out cyber

policy, including crisis management in the event of a worst case scenario.


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11.References1. http://www.sethassociates.com/wp-content/uploads/Evolving-Strategies-for-the-

Enforcement-of-Cyberlaws.pdf2. http://www.nytimes.com/2010/01/22/business/global/22music.html3. http://hothardware.com/News/Whats-the-Real-Impact-of-Piracy-on-Music-Sales/4. http://www.wisegeek.com/what-is-online-piracy.htm5. http://mattbrundage.com/publications/online-piracy/6. http://www.oxera.com/cmsDocuments/Agenda_October2011/Music%20piracy.pdf7. http://bbs.stardestroyer.net/viewtopic.php?f=22&t=1472298. www.nber.org/chapters/c12454.pdf9. http://www.radioandmusic.com/content/editorial/news/piracy-costs-indian-music-

industry-325-mn-ey

10.http://www.aact.in/Reports.php11.http://www.aact.in/downloads/reports/March2008-

EffectsofCounterfeitingErnst&Young.pdf

12.Kampelman, M. M. 1947. The United States and International Copyright. AmericanJournal of International Law 41 (2): 40629.x

13.US facts by Institute for Policy Innovation (IPI)IPI's figures are based on the RIMS IImathematical model maintained by the U.S. Bureau of Economic Analysis.

Information Systems Management Project_Final 2

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