Blog, EU

Commission Paper on ‘Connected TV’ and its Relevance for Online Businesses

May 10, 2013

The European Commission has just launched a Green Paper entitled ‘Preparing for a Fully Converged Audiovisual World: Growth, Creation and Values’. The objective of this Paper is to start a broad, public discussion on the implications of the on-going transformation of the audiovisual media landscape. The concept of ‘convergence’ takes centre stage which is understood as the ‘progressive merger of traditional broadcast services and the internet’. By trying to account for the fact that all devices through which audiovisual content can be consumed become increasingly connected, the paper addresses two sets of questions.

First, the Commission would like to consult on how to transform the process of convergence in the European market into economic growth and business innovation in Europe. Second, the Commission focuses on the consequences of convergence for values (i.e. policy choices) such as media pluralism, cultural diversity, and the protection of consumers as well as minors in particular.

These two issues lead to a subset of questions that are of fundamental importance to the future of online services and thus, require attention. Some questions relate to the challenge to established media from online players that operate across borders with economies of scale. Interestingly, the Commission explicitly mentions the successes of US companies in being able to provide cross-border services across the EU whereas, in the Commission’s opinion, European companies struggle. Somehow related is a question on the availability of premium content and associated competition concerns. The key issue there is in how far access to premium content is crucial for success in adjacent markets and may therefore act as a barrier to entry.

From a regulatory perspective the paper identifies the Audiovisual Media Services Directive, the E-Commerce Directive and the Electronic Communications Framework as all being affected by developments in convergence. While it does not mandate certain policy options, there is a strong likelihood that the AVMSD and the E-Communications Framework will be reviewed in the next Commission term where the topics identified in the Paper will play a role. Furthermore, the Paper contrasts the obligation of mostly European broadcasters to fund the production of European works with the freedom of online players. Crucially, the Paper acknowledges that this ‘might raise specific issues regarding contributions from non-European [online] players’.

Under a chapter entitled ‘Values’, the Commission discusses the implications of convergence on media freedom and pluralism. It questions in how far filtering mechanisms like personalized search results might decrease citizens’ exposure to a plurality of opinions and give undue, quasi  editorial powers to online platforms. Taking a step further, the Commissions opens the question whether there is a need for public intervention for such filtering mechanisms.

The last point on potential regulatory intervention sounds extreme, but is not surprising. Policy questions like these have to be seen in the context of a broader debate in Europe about ‘gatekeepers’ of all kinds. The Opinion on Net Neutrality by a French advisory body on digital issues e.g. extends the concept of net neutrality to ‘the new gatekeepers’ that are understood to be businesses providing services such as social networking, search, smartphone operating systems and app stores. The French Digital Minister has backed the report and said she will introduce legislation. This has become perhaps more likely in light of the spat between Appgratis (a French company) and Apple in which the latter decided to ban the French app from its appstore. Company-internal rules upon which such decisions are based will increasingly come under public scrutiny, particularly in a situation in which most of the ‘new gatekeepers’ are viewed to be non-European.

For these reasons it is important to respond to the Green Paper which lays out 27 questions. The deadline is 31st August 2013. CCIA will respond and will solicit Members’ input.

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