The Digital Dissonance: Decoding The Ambiguity Of ‘Broadcasting Organisations’ In A Streaming-First World

Contributor: Kamakshi Bhandari

With the onset of the digital age, the media landscape has undergone a radical transformation. The traditional broadcasting methods like television and radio programming no longer continue to dominate the distribution channels for content dissemination. The fast-paced internet and demand for personalised and on-demand viewing experiences have paved way for a new approach to content delivery and consumption led by over-the-top platforms (OTT) and digital streaming services. Thus, the disruption of the conventional broadcasting framework by this burgeoning digital ecosystem is challenging some of the existing legal definitions and regulatory provisions originally crafted for the analog era. One such legal ambiguity that demands reassessment is the definition of broadcasting organisation under Section 31D of the Copyright Act (“the Act”). 

Statutory Interpretation of Section 31D

The Act provides for a statutory licensing regime pursuant to S. 31D which extends to broadcasting organizations communicating literary and musical works or sound recordings to the public, subject to certain conditions. “Broadcast” includes “communication to the public by means of wireless diffusion, including signs, sounds, or visual images, or by wire,” as stipulated under S. 2(dd) of the Act. Further, the provision permits “broadcasting organizations” to obtain a statutory license for “communicating with the public”. As per S. 2(ff) such communication involves making a work accessible for public viewing, listening, or enjoyment.

The provision was introduced through the Copyright Amendment Act, 2012, with the primary objective of democratising access to copyrighted works, enabling broadcasting organisations to disseminate such content in the interest of the general public. A licensing regime was thereby set in place which allowed these entities to obtain a license upon payment of fixed and equitable royalties to the right holders, eliminating the need for individual permissions. This created a more streamlined framework for broadcasting and more importantly, struck a balance between the rights of creators as well as the public’s right to access content.

Exclusion Of Internet Broadcasting - An Unintended Consequence?

The omission of internet broadcasting from Section 31D by the Legislature which stipulates royalty rates for solely radio and television broadcasts reflects a conscious approach to confine statutory licensing to traditional mediums. Moreover, Rules 29 and 31 of the Copyright Rules, 2013 which contemplate no other mode of broadcast except radio and television, indicates that the scope of the Statutory License regime was intended to be kept narrow and thus, does not extend to internet broadcasts. 

This lacuna in the law has triggered a significant debate on whether OTT platforms, online streaming services and other forms of internet broadcasting must be brought within the ambit of the statutory license framework. While this flaw may not have been intentional at the time of its enactment, the changes in consumption patterns of audiences has rendered the current mechanism inadequate to address contemporary realities. 

Judicial Scrutiny

The Bombay High Court in the recent case of Tips Industries Ltd. v. Wynk Music Ltd. (2019 SCC OnLine Bom 13087), examined this issue in detail. The court noted the distinction between online streaming services and conventional broadcasting. While the former offers audiences the autonomy to select the content of their choice and when they wish to consume it, traditional modes like television and radio operate on a linear transmission model wherein the broadcaster determines the timing and nature of content delivery. This fundamental difference in transmission and autonomy places internet broadcasting outside the purview of Section 31D. Moreover, the section mandates a prior notice to be provided to right holders indicating the duration and territorial coverage of the intended broadcast. Given the inherently borderless nature of internet transmissions, enforcing territorial restrictions on them becomes complex, raising potential cross-border legal and licensing issues. The court in the Tips case held that unauthorised internet broadcasts or downloads infringe the owner’s exclusive rights to distribute, rent, or sell their work. The essence of the provision is such that once the content moves from being used solely for viewing and enjoyment to being made available for downloading or on-demand streaming, it transcends the scope of ‘communication to the public’.

The court further held that S. 31D is an “expropriatory provision”. It has been observed in cases like Union of India (UOI) and Ors. v. Board of Control for Cricket in India and Ors., (2018 (73) PTC 31) and State of Madhya Pradesh and Ors. v. Vishnu Prasad Sharma and Ors., (AIR 1966 SC 1593), that such appropriative provisions must be interpreted strictly and in such a way so as to lessen the impact on the expropriated owner. Moreover, for statutory license to be an exercisable right, pre-determination of royalty rates by the IPAB is an essential condition. The Board lacks the authority to issue such a license since it has not been conferred with the explicit power to determine royalty rates with respect to internet broadcasting.

In its Official Memorandum dated 05.09.16 of the DPIIT, the Government of India had liberally interpreted broadcasting to include internet broadcasting. However, the Bombay HC in the Tips judgement observed that executive instructions cannot override statutory rules. Guidelines that lack statutory backing are merely advisory in nature and cannot carry the weight of a Statute as held in cases of State of Haryana v. Mahender Singh, (2007) 13 SCC 606) and Narendra Kumar Maheshwari v. Union of India & Ors. (AIR 1989 SC 2138), hence speculative departures of the Executive should not render the legislation ineffective. In light of these principles, the Official Memorandum was later rescinded by the Department following its rejection by the Court in the Tips judgement. Moreover, the IPAB is a quasi-judicial entity and has been entrusted with the judicial function of statutory interpretation which the DIPP lacks. 

Additionally, by enabling app downloads, online streaming applications like Netflix, Amazon Prime, Jio Hotstar, etc. allows users to store offline copies of the content onto their devices which is equivalent to electronically storing a work. S. 14(1)(c) of the Copyright Act outlines the independent rights of a copyright owner with respect to their artistic work which includes the right to electronically store separate from public communication rights. The 227th Standing Committee Report also noted that a temporary electronic copy of a copyrighted work in the process of or for public communication would constitute infringement. Thus, the unauthorised storage by users onto their devices would be violative of the exclusive rights granted to the copyright holders warranting restrictions from appropriation of their work. 

The Case For Overhauling The Existing Regime

The validity of Section 31D has been challenged in cases like that of South Indian Music Companies Association v. Union of India (2016 SCC OnLine Mad 1787) where Courts have held that the provision intends to balance public interest vis-a-vis private interests of right holders by stipulating a fair royalty-based remunerative mechanism. It thus becomes unreasonable to exclude internet broadcasters from its purview. The ambiguous phrasing of the provision beginning with “any other broadcaster” has been interpreted by some to be open-ended and inclusive in nature. 

Taking into consideration the dynamic broadcasting landscape, in May 2019, the Ministry of Commerce and Industry introduced the Draft Copyright (Amendment) Rules to revise the existing Copyright Rules, 2013, under the authority conferred to it by Section 78 of the Copyright Act, 1957. These proposed amendments sought to align the Copyright regime with evolving technological developments and to harmonize it with other relevant legal frameworks. One of the key changes proposed was to Rule 29 which implements Section 31D of the Act. The amendment aimed to replace the phrase “by way of radio broadcast or television broadcast” with the broader term “for each mode of broadcast”, thereby potentially bringing internet broadcasting within the ambit of statutory licensing. Although these 2019 Draft Rules reflect a shift in legislative intent, until these amendments are formally enacted, the legal position as established in Tips judgement will continue to prevail.

Conclusion

The legislative vacuum in the existing copyright licensing regime necessitates urgent reforms to accommodate the needs of the present generation. Targeted amendments would have to be made in the current legislation such as clearly defining the term “broadcasting organisations” so that the ambiguity surrounding the concept is mitigated. Since the current mechanism involving royalty rates does not stipulate any structure specific to internet broadcasting, a specialised committee could be constituted to recommend a dedicated framework, akin to that of television and radio. 

Perhaps framing a digital specific broadcasting code, complimenting the statutory provisions in the Act and ancillary Rules, could be a solution, providing for a regulatory environment moulded specifically for such entities. Further, rules and specific guidelines with regard to their unique challenges like cross-border accessibility, dynamic content formats, and platform-specific licensing models would have to be formulated to comprehensively address them. These changes would offer much-needed clarity to digital platforms operating in the broadcasting space.

References

  1. The Copyright Act, 1957 (14 of 1957), s 31D. 
  2. The Copyright Act, 1957 (14 of 1957), s 2 (dd). 
  3. The Copyright Act, 1957 (14 of 1957), s 2 (ff). 
  4. The Copyright Rules, 2013, rules 29 and 31. 
  5. Tips Industries Ltd. v. Wynk Music Ltd., 2019 SCC OnLine Bom 13087.
  6. DIPP, ‘Office Memorandum on Statutory Licensing for Internet Broadcasting’ (5 September 2016) 
  7. RSPSC, 227th Report on the Copyright (Amendment) Bill, 2010 (2010).
  8. South Indian Music Companies Association v. Union of India, 2016 SCC OnLine Mad 1787. 
  9. Union of India (UOI) and Ors. v. Board of Control for Cricket in India and Ors., 2018 (73) PTC 31. 103 
  10. State of Madhya Pradesh and Ors. v. Vishnu Prasad Sharma and Ors., AIR 1966 SC 1593.
  11. State of Haryana v. Mahender Singh, (2007) 13 SCC 606.
  12. Narendra Kumar Maheshwari v. Union of India & Ors., AIR 1989 SC 2138.
  13. https://csipr.nliu.ac.in/miscellaneous/streaming-struggles-the-perplexing-puzzle-of-statutory-licenses-and-online-broadcasting/ 
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