Digital media has blended content material and expertise successfully and has largely been unregulated with folks being given full inventive freedom. The Indian viewers has welcomed this wave. This consumption of content material has additionally led to a progress within the variety of over-the-top (OTT) platforms launched in India.
Nonetheless, blatantly unethical behaviour due to company rivalries has led to misuse of social media by enterprises. The ministry of knowledge and broadcasting has burdened on the necessity to regulate OTT platforms and digital media however the latter are anxious about what sticky content material could possibly be on their platforms. The draw back when there are not any tips is that what customers see depends on the whims and fancies of the platforms and the shortage of accountability and transparency. Up to date rules say that if a authorities company or particular person objects to one thing controversial, it may be taken down. This might influence income for digital media and OTT platforms.
The media enterprise may be very IP-centric, with tech and content material being types of IP, stated Tanu Banerjee, associate, Khaitan & Co. Therefore, a variety of funding and diligence must be accomplished round compliance. Defending one’s IP would imply coping with rules correctly and being conscious. The tough half, when it comes to intermingling and interlocking, is that demarcation for rules shouldn’t be based mostly on the platform however the exercise that the platform is performing and most platforms carry out a number of capabilities. What the laws has missed is that everybody can’t be painted with the identical brush and there can’t be one thing so divided when it comes to compliance, Banerjee stated.
The place to which the IP belongs is vital as a result of it determines the place its possession is presiding, stated Vinita Krishnan, Companion, Khaitan & Co. So, when an worker is rolled in, there are worker contracts or third-party content material and repair suppliers. Who has management over the IP is needs to be agreed upon. If this doesn’t occur, the price of transferring the IP from the service supplier or worker to the corporate creates tax implications. The character of the licensing association needs to be seen clearly as as to whether it’s simply licensing or whether or not there’s a sale of a copyrighted article. That is extra related for international entities in software program companies. For a international entity, a ache level is the taxation of income. From an investor perspective, one problem is the tax danger for digital media corporations, as a result of if valuation shouldn’t be justifiable, the tax loss permits the tax officer to tax the surplus valuation within the arms of the Indian entity.
Supply: Live Mint