Friday, March 27, 2015

Major Changes Ahead For European Media

There are major changes coming to the European media industry thanks to a trio of new initiatives laid out by the European Commission.

They are going to push for better access to digital goods and services across borders by introducing harmonised consumer and contract rules, with more efficient and affordable parcel delivery, tackling geo-blocking, modernising copyright law and simplifying VAT arrangements. In other words the likes of Amazon and Netflix will be dealing with one country, not twenty eight. But they are likely to have to charge VAT and possibly even pay some corporate tax. For content owners this is bad news since they will be able to sell into one market not twenty eight. It will particularly impact on sports rights, which shows why companies like Sky and Liberty have been investing in building pan European networks.

Secondly, the EC is to tackle issues related to digital networks, reviewing  current telecoms and media rules to encourage investment in infrastructure, work towards a unified European approach to spectrum management and look at how to strengthen trust in online services through more transparency and the swift removal of illegal content. It also called for the quick adoption of new data protection rules. This means that the big networks will become even bigger monopolies and it will make it far more difficult for new entrants to enter the market since they will need to invest in pan European infrastructure.

Finally, the Commission is to promote a European digital economy by promoting interoperability of technologies, tackling issues related to unlocking the potential of big data, and promoting government e-services. The theory is that you can create European tech giants like Google, Facebook, Uber or Air BnB. The reality is that regulation is the barrier to these companies, and the example the UK is showing with driverless cars and drone deliveries is the approach that is needed, not more blanket red tape.

In recent years the EC has done good work in harmonising mobile roaming charges, but surely the first priority in achieving all of the above objectives is ensuring that all citizens have good, reliable broadband access ? The danger with the above is that it encourages massive multinationals and actually makes it much easier for US companies to take over the parts of the European media industry they don't already own.

May we live in interesting times, as the Chinese curse says...