On July 5, the Audiovisual Anti-Piracy Alliance (AAPA) issued a statement warning policymakers against banning geo-blocking technologies used to protect territorial licensing models, and to say that a ban on geo-blocking could increase the risk of piracy.
In 2018, the European Parliament passed regulation to address geo-blocking, and to ensure that it is non-discriminatory based on nationality, place of residence, and other criteria. Beginning in 2020 and every five years thereafter, the European Commission is committed to report on its impact to the Parliament and other EU regulatory bodies. Discussion of a March 2023 report on the implementation of this 2018 regulation has been underway.
Through its statement, AAPA takes a position in four areas:
1) Geo-blocking technologies are key to protect exclusive territorial licenses
Currently, audiovisual services providing access to high-value and premium content (sport, films, high-end drama or entertainment) are marketed on the basis of exclusive territorial licenses which allow right-sholders to negotiate and sell rights on a territory-by-territory based, reflecting the need to accommodate territory-specific needs. Geo-blocking helps preserve territorial licensing models.
2) The financing of the whole European audiovisual ecosystem depends on the preservation of the exclusive territorial licensing model
AAPA says that exclusive territorial licenses represent the most efficient and beneficial model for the European cultural, creative and sports sector, a model continues to underpin the financing of new film and audiovisual content production in the EU, in particular by enabling presales and preserving the value of future distribution rights. A 2020 study by Oxera says that if geoblocking did not exist, lost revenue could be as much as €8.2 billion euros per year.
3) Banning geo-blocking technologies for audiovisual services would not benefit consumers
A ban of geo-blocking for audiovisual services would end the territorial licensing model, leading de facto to a pan-European licensing model, which could favor the largest media corporations in Europe or major new entrants from outside Europe who would be the only entities in capacity to bid or afford pan-European licenses; consequently resulting in fewer programming choices, disproportionate market power being wielded by such corporations, and higher prices for consumers.
4) Banning geo-blocking for audiovisual services is not a response to the growing piracy of audiovisual content in the EU
AAPA cites industry reports that the main driver for piracy of audiovisual content is the price of the legal offer which is considered too high by some users, and that a ban on geoblocking would likely lead to more expensive legal offers for consumers, and consequently, higher levels of piracy.
AAPA’s position on the European Parliament own initiative report on the implementation of the Geo-blocking Regulation. Press release. July 5, 2023. AAPA Audiovisual Anti-Piracy Alliance
Regulation (EU) 2018/302 of the European Parliament and of the Council of 28 February 2018 on addressing unjustified geo-blocking and other forms of discrimination based on customers’ nationality, place of residence or place of establishment within the internal market and amending Regulations (EC) No 2006/2004 and (EU) 2017/2394 and Directive 2009/22/EC (Text with EEA relevance. ). Regulatory document. February 2018. European Parliament.
Implementation of the 2018 Geoblocking Regulation in the Digital Single Market. Report. March 2023. European Parliament
Why it matters
The Audiovisual Anti-Piracy Alliance came out in strong support of geo-blocking technologies, saying that “Geo-blocking technologies are a source of dissatisfaction only for consumers who want to access audiovisual content for free.”
AAPA also notes that geo-blocking serves to protect cultural demands and viewing preferences that differ across EU member states.
A cynic may say “well of course AAPA supports geo-blocking,” based on the fact that some AAPA members are anti-piracy technologists whose product portfolios have some focus on location. But any bias is tempered by the needs of major rights-holders that are also members of the organization. AAPA’s concerns are vendor-neutral.