Lord Triesman, the Minister for Intellectual Property, has launched a consultation looking to ensure that the UK's copyright laws are fit for the digital age.
The aim is to ensure that copyright remains a balanced system in the digital age and follows the Gowers Review which recommended reform of some aspects of the intellectual property system.
Proposals include greater freedom for 'format shifting' which would allow consumers legally to transfer music or films between technologies, such as ripping CDs to MP3 files for use on media players.
Other proposals include allowing schools and universities to make the most of digital technologies and facilitate distance learning.
"Copyright law affects our everyday lives whether through the music we listen to, the films we watch and the books we read," said Lord Triesman.
"In an increasingly digital world, we need to be sure that our copyright system keeps up with the times and works effectively.
"It underpins the success of a variety of culturally important and economically successful sectors of UK industry such as music, film, computer games and sport.
"This consultation explores where the boundaries lie between strong protection for rights holders and appropriate levels of access for users. A system valued by rights holders and respected by users is critical to UK creativity."
The consultation will consider expanding exceptions for educational use, which could facilitate distance and online learning by enabling extracts from books, plays and broadcasts to be distributed digitally.
Furthermore, changes for libraries would allow the copying of sound recordings, films and broadcasts for preservation purposes and to format-shift works stored on obsolete or unstable media.
The consultation is also looking into a new exception for parody, which could have a major impact on the use of copyrighted material in video mash-ups and similar content on internet video sharing sites.
Ian Fletcher, chief executive of the UK Intellectual Property Office, said: "We should not underestimate the importance of drawing the line between access and protection in the right place.
"I appreciate that there will be a range of views as to where that line should be, but I urge all those with an interest to make sure their voice is heard."
The deadline for responses to the consultation is 8 April 2008.
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