Page 204 - A Study on the Role of UGC Platforms in Copyright Law：An Intermediary-oriented Approach

A Study on the Role of UGC Platforms in Copyright Law: Chapter 6 UGC Platforms’ Entitlement to UGCs
An Intermediary-oriented Approach

allocate a certain percentage of revenue to UGC creators according to the popularity of their
UGCs. This could be determined by the number of followers or viewership. The percentage
of revenue set aside for allocation could be decided by a third-party authority such as the
copyright royalty judges. Many UGC creators are not repeat players in content creation.
Thus, it might be difficult to establish an entity to collectively manage UGC creators’
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copyright. Further, it could be difficult to obtain information on the popularity of every
UGC. Many UGCs are not widely distributed and do not exert much influence on the market.
Accordingly, I suggest that UGC creators who wish to be remunerated for UGC platforms’
indirect exploitation apply for it on their own and provide relevant evidence of the URL, the
originality and the popularity of the UGCs they wish to be remunerated for. The cost of such
application, which could be moderate rather than excessive, would be enough to filter out a
significant number of UGCs with marginal value, and significantly alleviate the management
cost for UGC platforms. UGC platforms would only need to collect data on the popularity of
the UGC applicant and allocate the remuneration to its UGC creators accordingly, pursuant
to the methods and criteria discussed in Section 5.5.2.
In summary, UGC creators can earn both direct and indirect remuneration from UGC
platforms. Direct remuneration is related to UGC platforms’ exploitation of specific UGCs
and should be automatically allocated to the creators of specific UGCs. Indirect remuneration
is derived from UGC platforms’ exploitation of an entire category of UGCs. Therefore,
UGC creators, upon application, should be entitled to indirect remuneration based on their
contribution to the UGC platform, namely, the popularity of their UGCs.
The remuneration scheme for UGC creators discussed here is different from the non-
commercial UGC levy schemes discussed in previous chapters. Levy schemes address the
end users’ use of copyrighted works, and distributors who facilitate and profit from the
use are required to remunerate copyright owners. In contrast, the remuneration scheme
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proposed here directly requires payment by the professional users, namely, the UGC
platforms. Nevertheless, this remuneration scheme works collaboratively with the non-
commercial UGC levy schemes. If the revenue the UGC creator earns exceeds the revenue
threshold under the non-commercial UGC levy schemes, the UGC creator would not be
covered by the levy schemes but should seek a licence from the copyright owners of the pre-
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existing works.
Similar to the non-commercial UGC levy schemes, the UGC remuneration scheme

233 Robert P. Merges, ‘Contracting into Liability Rules: Intellectual Property Rights and Collective Rights Organizations’ (1996)
84 California Law Review 1293, 1293.
234 Section 2.3.4.
235 To be covered by the proposed levy scheme, the UGC should meet the following requirements: (i) the revenues the UGC
creator captured should not exceed a certain threshold, (ii) the traffic the UGC attracted should not exceeded a certain
upper limit, (iii) if the UGC exceed the revenue threshold or the traffic threshold, the UGC should have less than a certain
percentage of content identical to the content of a pre-existing work. The criteria for the revenue, traffic and overlapping rate
can be decided by a third-party authority. See Section 5.4.2.

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