Hiscox comments on the Hargreaves report

LONDON, UK, (17th May 2011): With the results of the Hargreaves report due, Alan Thomas, head of technology and media at specialist insurer Hiscox, comments:

"This area of legislation could have serious implications for a large number of diverse stakeholders. The digital economy is primed for massive growth, however as with all emerging industries, the law is playing catch up to the reality of doing business online. The Hargreaves report goes a long way in demonstrating why it is vital to create a balanced piece of law that protects both the rights of those industries creating digital material as well as allowing new businesses to flourish without the fear of unjust prosecution."

"One of the major costs to businesses lies within the process of obtaining permissions from rights holders for their digital material. Companies such as Spotify and Last FM have already highlighted this challenge and for smaller start ups and digital entrepreneurs this remains a major hurdle making it difficult to enter the market, which in turn stifles innovation. Technology should enable us to open up the market for both buyers and sellers. Many of our customers are pioneers in the digital economy and we welcome progress and clarity for creative industries and consumers alike."

The biggest risks we see to entrepreneurs in the digital economy are:

• The potential for expensive litigation costs when testing the boundaries of any new legislation.
• The challenge of keeping businesses and individuals aware of the changes in law and their obligations in an every changing landscape. We've seen how difficult this can be with the recent European legislation on cookies.
• Finding ways of monetising content whilst allowing revenue to flow back to the true copyright owner. Not easy in a culture of consumer behaviour where many expect to receive all their online content for free.
• Shifting or creating new business models which allow established media companies to continue to deliver quality content to their consumers in a profitable way.

ENDS

For further information:

Notes to editors

About Hiscox

Hiscox, the international specialist insurer, is headquartered in Bermuda and listed on the London Stock Exchange (LSE:HSX). There are three main underwriting parts of the Group - Hiscox London Market, Hiscox UK and Europe and Hiscox International. Hiscox London Market underwrites internationally traded business in the London Market - generally large or complex business which needs to be shared with other insurers or needs the international licences of Lloyd's. Hiscox UK and Hiscox Europe offer a range of specialist insurance for professionals and business customers, as well as high net worth individuals. Hiscox International includes operations in Bermuda, Guernsey and USA. Hiscox Insurance Company Limited, Hiscox Underwriting Limited, Hiscox Europe Underwriting Limited and Hiscox Syndicates Limited are authorised and regulated by the Financial Services Authority.

For further information, visit www.hiscox.com.