Law 1.0: Law, Technology, and Entertainment

Whilst Brownsword discusses the technology-law interface and notes that lawyers and technologists would historically have had little to say to each other, law has nevertheless always responded to technology, and ‘[t]he cultural impact of intellectual property has been stoked, and in part driven, by developments in technology’ (Jones, 2009: 110). An overused example is the statutory response to the creation of the printing press with the enactment of the Statute of Anne 1709 (Rose 2010; Morris 1961). More specifically legislation has always been used as a tool with which to try and harness, and regulate, technology within the entertainment industry. This is essentially the notion of Brownsword’s Law 1.0. For him, Law 1.0 reflects the question that lawyers would traditionally ask when confronted by a novel situation: how do existing laws and principles apply to this new phenomenon. Within a Law 1.0 mindset, there is ‘a good deal of nervousness about stretching legal principles, or creating ad hoc exceptions, in order to accommodate a hard case’ (Brownsword 2022: 47).

During the 19^th century, technological developments in the entertainment sector accelerated, creating problems for the Law 1.0 approach. The Lumiere Brothers presented film for the first time in 1896 (Rossel 1995; Hunninger et al. 2015). The development of this new technology led to a reappraisal of the suitability of existing IP laws that had been developed before these technologies existed, and whilst case law may have tried to ameliorate the effect of these lacunae, the legislation was updated in the early 20^th century in the Copyright Act 1909 (Alexander 2010). Further innovations, including adding synchronised spoken word to film and the birth of the ‘talkies’ necessitated another rethinking, specifically in terms of bringing the voice within the purview of film star contracts (Gaines 1991), again illustrating the legal challenges presented by technological advancement. In music, ground-breaking developments such as Edison’s invention of the phonograph in 1875 (Edison 1878; Hull 2004; De Graaf 1995), resulted in the Copyright Act 1911 providing record companies with the right to prevent unauthorised copying of their recordings (Jones 2009). Whilst law has always responded to technology, this response has often been piecemeal and slow. As Greenfield and Osborn (1997: 80) put it:

‘The law is notoriously slow to respond to technological advance and often by the time that it does act events have been superseded or overtaken. Such problems have been exacerbated in the recent past as the pace of change has become more pronounced creating a number of problems regarding exploitation of rights within the context of changing cultural, geographical, philosophical and electronic boundaries. At the heart of this debate lies the role and function of copyright and perhaps even the issue of whether it can survive the digital challenge.’

The law has difficulties responding to technology which are exacerbated when technologies develop at pace. Initially, whilst there was a lag between the development of technology and the legislative response, it was relatively short. The UK’s legislative process involves recommendations being made, perhaps by the Law Commission, Green Paper and White Papers being drafted and debated and, eventually, a bill processing through both Houses of Parliament. It is not quick, with attempts to subvert the process and create law as a quick fix response proving problematic. Redhead’s concept of panic law (1995: 112) describes ‘the frensied [sic] but simulated state of law and justice at the end of the [20^th] century’. We have refined this concept to tie more explicitly into a response to what Cohen called moral panics and how the law responds to them. Cohen’s idea of moral panic was outlined in his seminal text (1972) that explored how ‘folk devils’ who were perceived as being a threat to society and/or its values were the impetus for ‘moral panics’. These moral panics create the circumstances in which the government of the time feels impelled to legislate to curtail by criminalisation the folk devils’ behaviour.

Cohen’s thesis attempted to explain the exaggerated societal reaction to perceived threats to its moral values (King 2003). Our interest, and where Redhead’s analysis comes in, is how the law reacts to these moral panics. As Gur-Arye puts it: ‘once a moral panic mobilises the public, pressure on both the legislature and the courts intensifies to do something …’ (2017: 316). This ‘something’ is what is often problematic. The political desire to be seen to be doing something to address the activities of the folk devil, rather than taking the time to consider the root causes of the underlying problem, is what leads to the ill-considered, reactive legislative interventions that are the paradigm of panic law. Panic law is how the law responds to various stimuli, be they video nasties (Barker 2020), dangerous dogs (Allcock & Campbell 2021) or football fans (Greenfield & Osborn 1998). These loose and unfocussed legislative provisions are little or no use in practice, although they may have some symbolic political and legal value. Panic law is essentially a form of Law 1.0, and as will be seen below, these kneejerk responses are neither nuanced nor do they address the bigger picture.

The Law 1.0 period is epitomised by a fairly consistent lag between the emergence of a new technology and its regulation, resulting in law and technology developing in parallel. The regulatory lag may be significant, but is perhaps legitimate given the need for due diligence to develop laws that deal adequately with specific problems. However, Brownsword notes that Law 1.0 is unstable and subject to disruption, where new technologies disrupt its application and encourage the emergence of a more nuanced Law 2.0 approach.

Law 2.0: Digital Year Zero and Accelerating Dissonance

Copying in the analogue world was problematic. Jones (2009) notes that it was costly, time-consuming and came with a degradation of quality. In the digital world, many of these problems disappeared, a development that was pregnant with possibilities. Technology problematised further the issue of copying, with the prevailing Law 1.0 approach proving to be increasingly unsuitable. Instead of approaching the regulation of emergent technologies holistically, a lack of legislative creativity saw new protected categories added to later Copyright Acts. Essentially, the Law 1.0 approach becomes increasingly reactive, which in turn increases the dissonance between the law and its ability to regulate technology effectively.

Technological development is rarely linear and accelerates at a faster pace than legislative interventions can accommodate. Nowhere is this more apparent than in the music industry. The shift from recorded sound being analogue to being comprised of ones and zeros (digitised) created many problems for the music industry. Even the most recent significant legislative intervention, the Copyright Designs and Patents Act 1988 failed to deal specifically with many technology-driven issues. For example, sound sampling, a practice inspired by the Jamaican practice of ‘toasting’ over records and initiated via the creation of computers and the ability to digitise music, which had been common practice for many years and had created all sorts of discussions and allegations of possible infringements and philosophical debate, was not addressed by the 1988 Act. Whilst not the subject of this article, similar issues can also be seen in the technological challenges of streaming Napster and Bit Torrent for example.

Brownsword gives a neat explanation of how Law 2.0 operates. He cites the example of crime dramas and their use of an evidence board or ‘crazy wall’. In cinematic terms perhaps this reaches its apotheosis with Tom Cruise’s character in “Minority Report” (USA 2002), but it refers to the practice of the board used by detectives to pin photos of suspects and crime scenes and make notes about possible motives, create links, and hypothesise about the case. The way that regulators look at a new technology under Law 2.0 resembles, to Brownsword (2020: 33), how detectives sift and evaluate their cases:

‘In the same way, regulators addressing a new technology in a Law 2.0 frame might also start by using a crazy wall to focus their thoughts … the challenge of getting the regulatory environment right is a multidimensional one; a Law 2.0 conversation can range across questions of legitimacy, effectiveness, and connection, and it is not just a matter of getting the rules right – the institutional apparatus that stands behind the rules must also be fit for purpose’.

The emergence of the new technology is the equivalent of the commission of a crime, and it is this emergence that provokes the lateral thinking and vehicle for their focus. What are the impacts of the new technology on the right to privacy? Or property rights? Is it potentially harmful? All these questions and more can come within the purview of the crazy wall. Importantly, possible benefits as well as negative aspects will be considered. The wall provides a mechanism for charting these issues holistically, whilst for the regulator it enables an evaluation of how best to achieve its objectives.

As noted above, the relationship between Law 1.0 and Law 2.0 is analogous to the relationship between classical contract theory and neoclassical contract theory; the latter tries to ameliorate the harshness of the former without destroying its very foundations (Greenfield & Osborn 2008). So, for example a traditional approach to the enforceability of a record or publishing contract under Law 1.0 would begin by looking at whether the formalities of contract had been followed. It would recognise that the technology had developed to allow the subject matter of the contract to change (a new subject matter for contract, a ‘novel category’, predicated on development of recording technologies and its means of exploitation) but would apply the law to the contract in a more traditional black letter fashion. The act of signing the contract, the form, the content of the contract and how legal principles apply is primary.

Law 2.0. is more akin to a neo-classical approach that would recognise that contracts do not exist in a vacuum and would be more cognisant of the process by which the contract came into existence rather than focussing on the outcome (Law 1.0). In Law 2.0, the court faced with examining whether a contract should be enforced would examine the context, the process and consider policy; we might see the court explore a more welfarist focussed approach, or consider the use of doctrines that have developed to ameliorate the harshness of some of the more dogmatic applications of legal principle, such as restraint of trade, undue influence, or imbalances in the bargaining process. It may also consider the implications of enforcing such a bargain: what are the impacts on the artist and on the public? If there is no clause in the contract covering the exploitation of the material produced and artistic freedom, then the public’s ability to hear the fruits of artistic labour may be compromised. In such a case, a broader, contextual, Law 2.0 approach would consider the wider context of the relationship.

Law 3.0 does something different and offers a more radical alternative. Whilst Law 2.0 offers potential and can paper over the cracks or ameliorate Law 1.0’s problems and has some cognisance of policy and contextual issues, it still sees technology as an issue to be tackled. Technology in fact has a further and more nuanced possible use:

‘As for technology, in regulatory thinking, technological developments first present as a challenge, as a target for regulatory measures. However, a major rethink occurs when technologies then present as potential regulatory tools, to be used in support of rules or even to supplant rules and bear the full regulatory burden’ (Brownsword 2022: 7)

Law 3.0: A Radical Decentring of the Law

Law 3.0 is in some ways similar to relational contract theory, in that it is contextual with a vengeance. Technologies that might be considered a threat through the gaze of Law 1.0 or 2.0 are seen as potentially useful tools when perceived through a Law 3.0 lens. As Brownsword puts it (2022: 50): ‘With the emergence of Law 3.0, the questions are whether technical measures might be used in support of the rules relied on to serve regulatory policies, whether technologies might be used to assist those who are undertaking legal and regulatory functions, and whether the technologies and technical measures might actually supplant the rules and the humans who make, administer, and enforce them.’

Rather than a reductive debate about how the law applies to a new technology and how it deals with the problems that it might create, the question becomes one of how the technology itself might be able to tackle the problem. Can the technological advance, rather than being the subject of legal regulation, be the tool that enables effective regulation? Thus, blockchain and smart contracts might be seen as ways of supporting contractual principles rather than being the subjects of regulatory challenge. These new and emerging technologies are not without their problems, but they offer the potential for creative solutions. Emerging technologies such as AI would be interesting areas to consider here, and issues such as non-fungible tokens (NFTs) have already been looked at in terms of tickets, but we have chosen blockchain technology as the most apposite example to discuss here.

Blockchain is a technology-enabled distributed ledger system (Yeung 2019). Rather than being stored in one specific location or database, like a traditional ledger where some sort of central and ‘trusted’ authority exists, the records and digital information are stored across a number of different computers that synchronise with each other as new information is added (CMS 2023). Blockchain technology is transparent, ‘trustless’ and immutable, with no financial intermediaries or gatekeepers or the possibility for one single point of failure. This type of ledger is manifestly different to the traditional ‘star’ or ‘hub and spoke’ structure of centralised systems and relies instead on a distributed ‘mesh’ structure (O’Dair 2016: 6). What O’Dair’s report illustrates is the potential of blockchain for transformation; how the technology might transform or revolutionise the industry, specifically through ‘… a networked database for music copyright information … fast, frictionless royalty payments … transparency through the value chain … (and) access to alternative sources of capital’ (O’Dair 2016: 8), creating what he calls the networked record industry.

Thus, under a Law 3.0 approach, new technologies have the potential to be part of the regulatory solution, instead of being the object of new regulation as would be the case with Law 1.0 and 2.0. If Law 2.0 can be said to look at a broader range of normative instruments than just the law, Law 3.0 takes this contextualisation further looks beyond more normative rules to issues such as ‘appropriate design of places, products and processes’ (Brownsword 2020: 29). Technology and its tools can then be located on an interventionist spectrum further illustrating the necessity for a nimble approach and that ‘one size does not fit all’. At the soft end of the technological spectrum is the use of CCTV, a technology that aids compliance with the rules and provides evidence of rule breaking. At the hard end of the spectrum, technology is embedded in the hardware or regulatory architecture, limiting the practical options of those subject to the regulations; Digital Rights Management is one instance of this where geographical restrictions can be embedded into the product itself. Further, Law 3.0 indicates that technology might be part of the solution to the problem, not merely another issue to be tackled by the regulatory lens.

Having outlined the concepts of Law 1.0, Law 2.0 and Law 3.0 more generally, we now apply these theoretical lenses to the ticketing industry more specifically, charting not only how tickets fit within this framework, but also where tickets sit on the technology spectrum.

Event Tickets: Law, Technology, and the Case for Law 3.0

In this section, we build on the analytical framework developed by Brownsword and apply it specifically to tickets, and in particular to the regulation of the secondary market in event tickets. Tickets to sport and entertainment events are purchased by event attendees in one of two generally accessible markets. The primary market consists of the original sales by event organisers and/or their official or authorised agents to the original purchaser. The secondary market consists of resales by the original purchaser to third parties. It is this market that has been the focus of direct legislative intervention to ensure that purchasers using the secondary market are provided with sufficient protections. A specific subset of the secondary market, and the one that has fuelled many of the legislative interventions to date, is the uncapped and unauthorised resale of event tickets, commonly referred to as ticket touting or scalping. In this case, tickets are bought and/or sold in breach of the ticket’s terms and conditions (T&Cs), with the original purchase being made with the intention to resell the ticket for a profit (Competition and Markets Authority 2021: 12).

The secondary market in event tickets has experienced technological developments similar to the rest of the creative sector, especially its transition from exclusively physical to predominantly digital tickets. The regulation of this secondary market has suffered from a similarly piecemeal and reactive series of panic law responses. The lack of an effective strategy for these legislative interventions has left the law struggling to regulate the technological developments in the resale and purchase of tickets, unused by police and prosecutors, and functionally obsolete. Using Brownsword’s framework, the evolution of the regulation of the secondary ticketing market will be analysed to demonstrate how Law 1.0 and Law 2.0 approaches have contributed significantly to the legal-technological dissonance.

Conclusion

Law 1.0 and Law 2.0 interventions have had little impact on the secondary market. What this article demonstrates is that regulatory interventions are unable to keep pace with ticketing technologies and are inappropriate on their own as a mechanism to regulate touting. As tickets have moved from paper to digital, with sales moving from box offices to telephone purchases to online transactions, the legislative framework has been incapable of preventing the unauthorised resale of event tickets. Technological developments have proven themselves to be doubly disruptive. First, they have disrupted our understanding of what law is and where it is to be found. Secondly, technology has disrupted the idea that law is the central instrument of social order and introduced the prospect of technological governance (Brownsword 2022: 5). Where Bengoetxea is right to say that technology shapes the law – it can and does – the increasing dissonance between legal intervention and the emergence of new technologies means that the law is rarely the answer to effective regulation, though it may be part of a more rounded, holistic response. The doubly disruptive effect of emergent technologies paves the way for a more radical, Law 3.0 response.