SCL Event Report: Content Licensing – Recent Trends and Virtual Worlds

February 23, 2017

This event concentrated on the rise of
digital, disruptive technologies which have affected the way in which content
is marketed, licensed, distributed and consumed. The three speakers were Jenny
Buckley, Legal Counsel at Sky UK, Fiona McKenzie, an associate in Herbert Smith
Freehills’ Technology, Media and Telecoms department, and Richard Homer, Senior
Legal Counsel in Sky UK’s Technology and Enterprise team.

Jenny Buckley explained how Sky UK was
actively driving change by guiding the audience through the evolution of the
Sky UK TV business from its origins in 1989 to its new Sky Q platform, before
highlighting other elements which are determining the course of the Pay TV
landscape, eg changing viewer habits, prevention of piracy and a new focus on
high-quality content. Jenny then explained that this new technology is in turn
causing companies to change their business model, eg TV now being streamed over
broadband rather than being delivered via a cable service, and how this has
opened the market up to new and vibrant competition.

Fiona McKenzie then tackled the legal
challenges posed by these technological developments and how they affect
licensing content. Tricky issues content providers and lawyers now face in
negotiations include whether the rights granted under a licence are linear,
non-linear or simulcast (ie content can be available simultaneously on more
than one device) and how and to whom the content can be distributed. By
carefully controlling the way in which content is licensed, TV companies can
open up fresh revenue streams. Protection of these fresh revenue streams should
be at the forefront of lawyers’ minds when negotiating licensing agreements.

Finally, Richard
discussed the future of AR, VR and 360º video, the obstacles
currently preventing large-scale implementation and the sectors in which AR, VR
and 360º video are already making an impression. Although the technology has
been spoken about for decades, a lack of content and high entry costs for
producers and consumers alike have prevented it from entering the mainstream.
However, costs are being driven down by investment by ‘big players’ and
technological improvements. Richard then reviewed the starting positions
companies should take when acting as licensor and licensee and some common red
flags to look out for when negotiating licensing agreements.

Although it is clear that there are
technological and legal hurdles which must be vaulted before entering a virtual
world becomes a reality for a mainstream audience, if recent trends are
anything to go by, the (virtual) future is very bright indeed.

Fergal Duggan is a trainee at Herbert Smith Freehills.

Delegates at the SCL Junior Lawyers' Group event

Delegates and speaker panel at the event