Earlier this year not one but two European commissioners had the issue of geo-blocking in their sights. Vice President, Andrus Ansip announced plans to end territoriality for digital content in late March, while Competition Commissioner Margrethe Vestager also announced an inquiry into the legality of geo-blocking with the 28-nation region.
The European Commission is moving towards creating a Digital Single Market (DSM), although whether the proposals on the table will help achieve that is open to debate.
Ansip’s drive to make changes was largely driven by a belief the change would be popular with the voters and also by a lack of understanding of copyright law. Vestager’s intentions were more in line with the founding ethos of the EU, or “Common Market” as it was originally known.
The Commisson’s Digital Single Market (DSM) strategy is predictably at odds with other activities the Commission is implementing. Recent changes to European tax legislation require sellers to account and pay tax in the territory of the purchaser rather than the vendor.
The intention was to prevent companies such as Google and Amazon from locating their operations in the most tax-beneficial territories and paying little or no tax. The effect was that smaller companies must now submit up to 28 income and GST-equivalent tax returns instead of the previous one.
However, the intention of the DSM is to make it simpler to do business across borders – which businesses argue the changes to tax legislation prevent.
The Common Market’s most “common” currency, the Euro, is currently in all sorts of strife as a result of the ongoing challenges in Greece. While the EU might like its 28 member states to act as one, that’s as likely as finding beef at a Hindu’s wedding. While Europe Commissioners would like the continent to be one, the founding legislation also commits to the preservation of cultural diversity – an open-to-interpretation term pressed into service to protect all manner of local interests.
For copyrighted content, Ansip’s original proposals would have forced through a requirement that any content offered online anywhere in the EU must be offered in all the EU, while Vestager’s proposals would have ensured that any pan-regional price differences for digital content were reasonable.
For the major US distributors, the original EU proposals were good news – which in itself was a call to arms for many continental Europeans, who regularly argue against the dominance of English-language content on screens of all sizes. Europe’s supposed commitment to cultural diversity is also being questioned by some who believe the proposals put forward would allow the likes of Netflix to squeeze out smaller European content distributors.
Some fare travels better than others, in Europe as elsewhere. Currently Scandinavian drama such as Borgen and “Scandi-crimes” The Bridge and The Killing are proving especially popular beyond their own countries, either subtitled or remade.
However, the native languages spoken across the EU’s 28 nations number well over 40. Screen content is produced in all those languages and more.
While the wider availability of some fare might be good for viewers, that’s not necessarily true for producers. Some European TV buyers are beginning to insist on all-of-EU rights on deals running beyond 2017 (the expected implementation date for any changes to EU legislation). Broadcasters argue that if they pay for content, it’s unfair if that content can be accessed online from a broadcaster in another country.
It’s a similar argument to the one Sky and others recently put forward here to have ISPs cease offering “global mode” services, although European legislators are leaning towards improving market access rather than restricting it.
Vice President Ansip’s proposals are now being watered down. The original commitment to nix all forms of geo-blocking has now been amended to define some of the terminolgy as:
geo-blocking, i.e. simple refusal to sell or automatic re-routing and geo-filtering, i.e. unjustified diversifying of sale conditions
The word unjustified isn’t defined, but in other dealings the Commission has ruled that actions taken to protect a company’s market position can be considered “unjustified”.
The European Commissioners have sought input from various parties engaged in online content delivery, last week sending out a 100-page questionnaire to organisations across Europe. The Commissioners propose to put forward new legislation by Christmas.