My Lords, I enjoyed the graphic picture described by the noble Lord, Lord Stevenson, of how things have changed and the smaller scale of everything as a result of the digital world. Despite his comments on the previous amendment, I think that we share a common goal: to legislate for the consumer of digital content in a 21st-century way.
One of the main aims of the Bill is to provide clarity on what rights consumers have when goods, digital content or services are substandard. I am sure that we are all agree that one of the things that a consumer needs to know is to whom they should go when things go wrong. Intermediary businesses also need to be clear on when the rights do and do not apply to them, particularly when they are developing new and innovative business models. The digital content quality rights are contractual rights consumers have when they pay a trader to supply digital content to them under contract.
The noble Lord, Lord Stevenson, asked whether freemium products were covered by the clause for those who are not as digitally aware as some among the younger generation. A good example would be “Smurfs”, which is a free game but users can buy additional content within the game such as a house for Smurfers. The basic model is free but consumers then pay, sometimes at premium rates—hence the term freemium—for enhancements and additional features. Where a consumer pays for digital content and the trader provides it under a contract, the quality rights
apply. This means that the initial free product will not attract the quality rights. However, the later paid-for features will, indeed, attract the quality rights. This includes being fit for the purpose for which they were bought—that is, to use in connection with the free product. Those of us who have studied the proceedings in another place will know that “Candy Crush” occupied a great deal of time among Members, to their great delight.
The noble Lord also asked what happens when the two matters come together and whether the quality rights that apply to the paid later additions then change the status of the free product. I will come back to him on that point.
The digital content chapter covers a consumer contract with the trader who supplies the digital content and not the intermediary who introduces the consumer to the trader, as they are not supplying that digital content. The intermediary will be covered only if they also supply digital content as part of their business. For example, if a consumer buys a computer game from an online trader such as Green Man Gaming, Green Man Gaming is the trader, in the same way as if they buy a board game from WH Smith, WH Smith is the trader.
If the consumer uses a search engine to find a trader from whom they can buy the game, the contract is not between the search engine and the consumer. The same is clearly true in the physical world. If the consumer uses Yellow Pages to find a shop, Yellow Pages is not the trader.
What consumers need to know is who the trader is. This information needs to be clear and transparent. I know that this is not always the case in the digital world. However, the consumer contract regulations, to which we referred in our discussions last week, came into force in June, particularly in respect of distance sales. They require that the identity of the trader and their contact details are provided to the consumer before the contract is made. This applies to digital content as well as to goods and services. Therefore, the proposed amendment is not necessary because this is how our reforms work. The rights apply against the trader the consumer has paid for the supply of digital content and not against the intermediary. The name and contact details of the trader have to be provided to the consumer under those regulations. I therefore ask the noble Lord to withdraw the amendment.