The digital package must be part of the solution to cyber crime, not part of the problem
December 15, 2021
Paul MacDonnell, executive director, Global Digital Foundation
During the coming days and weeks Members of the European Parliament are to consider new laws that will affect Europe’s online life. The digital package, comprising the Digital Services Act (DSA) and the Digital Markets Act (DMA) are a testament to the Union’s determination to ensure that digital platforms operating within the EU align with distinctly European ideas of a well-ordered economy and citizens’ rights to have a say in what happens to their personal data. Up until now much has been said about the broad-brush approach of a number of the acts’ provisions. There are, for example, the practical difficulties of opening up platforms’ data to third parties and the possible consequences for free speech of appointing officials with responsibility for determining what is and isn’t allowed to be published online. However, legal scholars and policy analysts have begun to point to another, strategic, threat that will materialise if EU institutions simply rubber-stamp the DMA and DSA. If implemented without regard to Europe’s commitment to, and current position within, a global information and network-security framework the digital package could set Europe back years in areas such as child protection and national cyber-security.
The EU already has a robust legal and procedural system for dealing with threats such as cyber attacks and online exploitation of children. The European Network and Information Security Agency (ENISA), Europe’s Cybersecurity Strategy, and the Network and Information Security (NIS) Directive (2016/1148) are designed to use and expand our capacity to deal with these and other threats. Operating within this framework Computer Security Incident Response Teams (CSIRTs) in each Member State are able to take action against online threats to security and human rights. In particular the NIS Directive specifies obligations for suppliers of digital services, including platform owners and operators of essential infrastructure, to notify the authorities about threats and, when they occur, to take steps to minimize their scope and duration.
What is the danger that the digital package could compromise EU cybersecurity and human rights online? Already there have been instances where European law has been applied without due regard to the implications for online safety. In 2015 Belgium’s Court of First Instance ordered Facebook to stop tracking Belgian citizens, including non-Facebook account holders. Facebook argued that it needed to differentiate ‘legitimate’ from ‘illegitimate’ visitors to its platform in order to take steps against bad actors who could establish fake accounts for malicious purposes. Facebook subsequently appealed the order on grounds of jurisdiction—the company argued that in the EU it is regulated in Ireland only. The decision of the Belgian court speaks to opposing and sometimes contradictory forces in European policymaking. On the one hand legislators want digital platforms to act responsibly to protect citizens and, even, democratic processes from cyber attack or manipulation. On the other they wish to constrain what they see as arbitrary decisions that adversely affect consumers including their right to privacy. The difficulty inherent in this approach lies in the fact that neither of these forces addresses the need for platforms to identify bad actors. It is easier for jurists, who are perhaps more familiar with the business of protecting human rights than they are with matters of cyber security, to see a victim of unfair arbitrary decisions rather than a malicious threat to online security.
Beyond problems encountered by digital platforms operating within the European Union this misalignment also has implications for global cooperation in countering cyber threats. For example, the United States’ National Center for Missing and Exploited Children (NCMEC), uses Microsoft’s PhotoDNA software to identify and tag images of child exploitation. Last year US platforms made over 1,000,000 such reports of Child Sexual Abuse Material (CSAM) concerning users in the EU to European police forces. But just before the beginning of this year PhotoDNA was found to be in violation of the EU's E-privacy Directive (2002/58/EC) meaning that electronic communications such as voice chat, messaging and web-based email were brought under the Directive’s Directives provisions on communications and traffic data (Articles 5(1) and 6(1)), thus protecting them as private communications. After this change the use of PhotoDNA was outlawed in the EU.
This brings us back to the DMA / DSA package. Article 5 of the DMA proposes that business users of gatekeeper platforms be given direct access to consumer data that has been obtained through these platforms and that they should be able to offer services to them through “third-party intermediation services”. Article 6 explains how this must be done. Gatekeepers must allow third-party technologies to interoperate with them. It must be acknowledged that as an acknowledgement of the security dimension Article 6 adds, “The gatekeeper shall not be prevented from taking proportionate measures to ensure that third-party software applications or software application stores do not endanger the integrity of the hardware or operating system provided by the gatekeeper”. This is welcome, but it suggests that any problems that arise are bound to be purely technical. The fact remains, however, that a range of unknown third-party actors, and providers of ancillary services to them—and who, therefore, may be unknown either to digital platforms or regulators—will be able to access personal data and intellectual property.
These measures take no or very little account of Europe’s wider obligations to protect the privacy and online rights of its own citizens, and to cooperate with responsible global actors in promoting and protecting global cybersecurity.
European policymakers and legislators have developed the digital package as an instrument that appears to be aimed exclusively at the large U.S. platforms without regard to the existence of powerful online actors in Asia and South America. Existing in a relatively unregulated market the digital package could grant them a privileged position to establish wholly-owned companies in Europe which could gain easy access to, not just private information on the major U.S. platforms, but to key technologies as well. EU legislators must call for further work on the digital package so that Europe can ensure that its implementation is consistent with the Union’s own cybersecurity and online human-rights framework and with its obligations to cooperate with responsible jurisdictions in the fight against cyber threats and online exploitation.
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Table. 1. The evolution of the music industries through digitisation
Contrary to the Korean music industry, Japan’s large music market and ‘well-developed’ IPR regime positioned Japanese companies into rent-seeking behaviour and hindered their adaption to digitisation. With an overly sophisticated IPR regime coupled with complicated licence agreements, they have been reluctant to digitise the music industry which has made it difficult for global fans to enjoy their contents. Therefore, Japanese companies have lost their momentum to take off further in the digital era. This results in a decrease of their global popularity. In particular, as seen from the Japanese case, the function of the producer-focused IPR regime and license agreements needs to be carefully reconsidered to be more consumer-oriented.
6. Conclusion
Having realised the importance of culture as soft power and witnessed the dominance of American pop culture, many countries are concerned that its strong influence has a negative impact upon their culture and national identity. Due to the fact that the notion of culture is related to art and national identity, the important function of business and the economy has often been overlooked while the concept of art and culture has been more highlighted (Kawashim 2012). In this regard, governments have tried to intervene to protect and promote their culture and national identity. However, most of their measures have been ineffective or unsuccessful.
Furthermore, with emergence of the Internet and ICT, digitisation has significantly changed the music industry and has played a critical role in producing and distributing music. Under these circumstances, consumers have also changed their music consumption behaviour. Therefore, knowing that the role of government is unlikely to be effective, it is important to emphasise the responsive strategy of business activities toward digitisation. In other words, it is essential to analyse how the business responsiveness changes competitiveness within the music industry and brings about a different outcome in the digital era where online diffusion prevails.
The rise of K-pop and the decline of J-pop explicitly demonstrate the importance of timely business activities and there is a contrast in their responsive strategies when faced with digitisation. Due to its large market size and producer-oriented IPR regime, Japanese companies have been less responsive to the new trends in the music industry despite active government initiatives to promote its cultural power. By contrast, Korean companies have been more actively engaged in improving the international competitiveness of its music industry. However, in recent years there have been increasing voices in Korea calling for the IPR regime to be strengthened. In this case, many aspects should be carefully considered by looking more closely at the example of the Japanese music industry. The important function of business rather than government support under consumer-friendly conditions. This has also been seen in other cultural industries such as film industry (Kawashima 2011; Messerlin and Parc 2014, 2017; Parc, 2016).
The findings of this paper may apply beyond the two countries considered. Because digitisation is a global phenomenon, and the shifting consumer attitude – from album to on-site performance such as concerts as main source of revenue, from ownership to streaming, or audio to video – has also been observed in Japanese and Korean music industries likely hits all music production and consumption around the world. For instance, chances are that we could unveil comparable results between, say, Sweden and France. Accordingly, business models need to be urgently and thoroughly revisited. In particular, country-specific and conventional copyrights based on cultural industries before the emergence of the Internet are no longer fit to the current borderless digital world. By being put on life-support well beyond its ‘sell-by’ date, it is proving to be toxic to the very products it aims to protect and enhance the value of.
The intention of this paper is not to disparage the Japanese music industry or exalt the Korean music industry. It aims simply to understand what made K-pop more globally recognised than J-pop. Japan and Korea are interrelated in many respects and have also been competitors in various sectors. Hence, they have exchanged many influences with each other. J-pop, K-pop, and their music industries are no exception. When they understand each other better, the two countries can then achieve better synergies to enhance their cultural competitiveness in competition. In this respect, much can be learnt from the two famous figure skaters Mao Asada from Japan and Yuna Kim from Korea. Both have often confessed in interviews that they were able to develop as better figure skaters due to the intense competition between them. The authors of this paper wish the same for both countries and their constructive future, particularly their cultures.
Acknowledgement
This work was supported by the Laboratory Program for Korean Studies through the Ministry of Education of the Republic of Korea and the Korean Studies Promotion Service of the Academy of Korean Studies (AKS-2015-LAB-2250003).
Disclosure Statement
No potential conflict of interest was reported by the authors.
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