On December 13, the European Parliament voted to maintain an exception to its 2018 mandate against geo-blocking for the Media & Entertainment industry, as it has done several times over the past several years. The vote was 376 votes to maintain the blocking exception, 111 against, with 107 abstentions.
Geoblocking is an integral part of the business models of many media industry segments, including the movie industry, television and sports broadcast. Geo-blocking helps them differentiate their offerings and also helps them meet contractual obligations with creative talent, rights-holders, and with distribution channel partners.
Because the net effect of geo-blocking is to make content more difficult to access, it runs counter to the EU’s principle of universal access by all EU citizens. But geo-blocking supports the basic premise of creating value from scarcity, which the industry depends upon.
Acquiescing to industry objections
“The film, cinema, and audiovisual sector in Europe jointly urges the European Parliament to cast a vote in favour of culture on 12/13 December 2023 by opposing the call for future inclusion of audiovisual services in the scope of the EU Geo-blocking Regulation,” said an industry statement which, by December 13, had been signed by 708 stakeholders.
“A ban on the use of geo-blocking technology to support territorial exclusivity for film and audiovisual content and services would severely jeopardize the creative and economic sustainability of the film and audiovisual sector in Europe,” it said.
By opening distribution to the full EU region, coupled with a range of financial incentives intended to nurture creative talent, boost consumer literacy, and spark business and technological innovation; the EU’s goals are well-intentioned. But the geo-blocking constraint remains unwelcome by industry stakeholders.
In 2018, the European Union removed barriers to cross-border trade, in the spirit of eliminating “discrimination based on nationality, place of residence or place of establishment within the internal market.” Regulation 2018/302 asserted that such barriers ran counter to the principle of a single market in the EU.
The 2018 EU regulation also took the position that the “abolition (of state barriers alone) can be undermined by private parties putting in place obstacles inconsistent with internal market freedoms. That occurs where traders operating in one Member State block or limit access to their online interfaces, such as websites and apps, by customers from other Member States wishing to engage in cross-border transactions (a practice known as ‘geo-blocking’).”
However, regulators also recognized that “Audiovisual services, including services the principle purpose of which is the provision of access to broadcasts of sports events and which are provided on the basis of exclusive territorial licenses,” and excluded them from the 2018 regulation.”
Policy review at the height of the Pandemic
In November 2020, the EU published a review of the 2018 regulation, which upheld its principles and re-stated its 2018 position that while the availability of audiovisual and other online content would give EU consumers more choice – particularly in the face of the COVID pandemic at that time.
Regulators recognized the severe losses in revenue by the industry during that period, adding further justification to the elimination of geoblocking.
However, the EU maintained the position that a policy needed further study, referencing the ‘upcoming’ Media and Audiovisual Action Plan, which was published just several days later. This plan further deferred the policy decision; to “Launch a dialogue with the audiovisual industry in order to agree on concrete steps to improve the access to and availability of audiovisual content across borders in the EU.
Intended stakeholders included producers, broadcasters, video-on-demand services, distributors, etc., consumers organisations, and other interested parties, such as national film funds.
MEPs want to revise EU geo-blocking rules to eliminate remaining barriers. Press release. December 13, 2023. European Parliament.
Vote for Culture in the European Parliament INI Report on the EU Geo-Blocking Regulation. Industry advocacy / statement. December 12, 2023. (708 signatories)
Europe’s Media in the Digital Decade: An Action Plan to Support Recovery and Transformation. Policy statement. December 3, 2020. European Commisssion
Commission publishes its short-term review of the Geo-blocking Regulation. Press release. November 30, 2020. European Commission
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. Regulation. February 28, 2018. European Parliament
Why it matters
The European Commission continues to defer a decision as to whether or not to mandate the elimination of geo-blocking for that sector, or, to continue to allow the exception in EU policy.
Clearly, the 600-plus industry stakeholders would prefer the latter. The M&E industry depends on scarcity to maximize its revenue opportunity, hence the loud and uniform objections heard from hundreds of stakeholders across the Media and Entertainment (M&E) industry. This scarcity comes from territorial, release window, rental period, distribution channel and other availability restrictions that are baked into the industry’s business model