By ALEX SPENCE and ZOYA SHEFTALOVICH
EU wants to change how millions watch Hollywood films and YouTube videos,
but legacy media groups are pushing back hard.
The biggest tech fight on the Continent this year
doesn’t involve Google or Uber, though those are big. Nor is it the raging
Transatlantic policy debates over net neutrality or the privacy shield so
steeped in technocratese of little relevance to most people.
The biggest is the fight over copyright. A looming
overhaul of the morass of laws and regulations across the EU will impact how
millions of people consume images, words and music on their various devices.
The folks in Brussels picked it knowingly. Coming into
office in 2014, the European Commission laid out an ambitious agenda to
overhaul the entire digital copyright system in the EU.
It’s moving on various fronts, investigating contracts
between Hollywood studios and TV stations while preparing new legislation that
could change everything from watching movies and sports to publishing videos on
YouTube. President Jean-Claude Juncker and his Commission pledged from the
start to tear down regulatory walls and create a truer European single market.
With this
initiative, Brussels stepped right in between aggressive consumer rights
advocates as well as Silicon Valley giants and legacy content-makers, from
Hollywood studios to major sports leagues. Playing out in backrooms for the
past few months, this clash is now coming to a head.
At first, it seemed a possibly easy win
for Brussels. Modern digital users are demanding. They want to read articles,
watch movies and TV programs online wherever they are, whenever they want, on
whichever device they happen to be using. Removing the formidable barriers in
place in Europe to doing that would be popular.
Yet the push from the Commission soon
encountered stiff resistance from companies and interest groups that had a lot
to lose. Unwittingly or not, Brussels was reviving an age-old debate that has
raged since the early days of the web and has only grown in scale. On the one
side are proponents of a free, open Internet who argue that copyright laws are
out of date with modern consumer habits; on the other, media companies that are
desperately trying to keep their business models intact. “Once upon a time
copyright was very technical and between people who made music and films,” said
James Waterworth, vice president of the Computer and Communications Industry
Association. “Copyright affects users on a much bigger scale now.”
If advocates of open Internet came with
the stronger hand and enjoyed the support of the Juncker Commission, the
lobbying countercharge from the so-called creative industry has succeeded at
least in toning down Brussels’ ambitions. The old boys of media have won a few
battles. They’ve not yet won the war.
“It’s still very hard to read what is
happening exactly and what the plan is,” said Martin Moszkowicz, the chief
executive of Constantin Film, a German film and TV company. “Until we know what
the plan is, I won’t sleep well.”
Hollywood
drama
Moszkowicz makes movies for a living.
Recently, he’s spent much of his time shuttling back and forth to Brussels,
worried that copyright reforms under consideration there will devastate his
business.
The Commission’s review of copyright laws
is wide-ranging, affecting a broad range of businesses in industries including
tech, retail, telecoms and media. But none feel like they have as much to lose
as the Continent’s film and TV producers.
The howls of panic went up when Andrus
Ansip, the Commission vice president for the digital single market, said he
“hated” so-called geo-blocking — a comment that was seen as a direct and
existential threat to their business model.
Producers raise money to make programs and
movies by selling exclusive rights over again in different countries and across
different platforms, often in advance. If their productions had to be made
available online to all consumers at the same time across the EU, their revenue
would plummet. That would hit small, independent producers particularly hard, they
argue, wiping out huge chunks of Europe’s audiovisual industry.
In December, the Commission released a proposal to
allow consumers to take their paid content subscriptions to services such as
Netflix with them when they travel in the EU.
Those in the creative industries hoped this bone
thrown from the other side would end the geo-blocking debate. But there’s talk
of more to come. By summer’s end, the Commission will present new rules for
cross-border distribution of television and radio online and measures to tackle
online content piracy. Also on the agenda: measures on the role of platforms
and illegal content.
“The scope [of the copyright package] is still under
discussion,” said Nathalie Vandystadt, a Commission spokesperson.
That lack of certainty has all sectors nervous — and
angry.
An open letter sent by
consumer rights groups, tech industry lobbyists and digital rights advocates to
the Commission last week argued that Europe’s “outdated” copyright regime was
putting free communication and access to knowledge online at risk. Wide-ranging
reforms would boost creativity, research and innovation, it said.
On the
other side, media groups are just as fervent, arguing that sweeping reform is
beside the point, since consumers already have access to a huge array of
entertainment online. The media companies warned the Commission is putting at
risk businesses that provide 7 million jobs and contribute €509 billion to
Europe’s economy because it doesn’t really understand their industries. “Are we
dealing with this because it’s [seen as] low-hanging fruit?” asked Grégoire
Polad, director general of the Association of Commercial Television.
Commissioner
discord
Ansip, the former Estonian prime minister,
is famously digitally savvy. An avid gadget user, he is rarely seen without his
iPad. He came in openly determined to ensure European citizens should not face
cross-border restrictions. In one speech, in April last year, Ansip described
geo-blocking as a “clear example of a practice that should not exist in the
21st century.” As Ansip saw it, programs on the BBC’s iPlayer, for example,
should be accessible not only to Britons when they travel overseas, but to
“millions of people [who] are ready to pay for it” elsewhere in the EU.
In the other camp was Günther Oettinger,
the EU’s digital society and economy commissioner. The German didn’t even have
a computer in his office when he took up the post. He had no experience in
tech, and was by all accounts unenthused by the digital economy and society
portfolio.
Where Ansip was perceived as sympathetic
to the technology platforms and open Internet advocates, Oettinger was seen as
more aligned with the traditional media companies.
When Ansip triggered panic with his
comments about hating geo-blocking, Oettinger made soothing noises. “I hate my
alarm clock at 5 o’clock in the morning,” Oettinger said in a remark that was
taken as a rebuke to his colleague.
The divide has resulted in confusion among
media companies about the Commission’s ultimate intentions. “What I see as a
lobbyist is that you get very different sounds and messages if you go and see
the Ansip people from seeing the Oettinger people,” one representative of a
media company said.
Vestager
goes after Sky
Even if the producers win the regulatory
fight with Ansip and Oettinger, they are worried about a competition
investigation by Margrethe Vestager, the EU’s competition commissioner, against
the U.K. satellite broadcaster Sky and six Hollywood movie studios.
The Commission says contracts between the
studios and Sky to screen their movies breach EU competition rules because they
prevent transmission outside the U.K. and Ireland. If the media companies lose
the case, it will be “a big defeat” that will undermine their business model, a
lobbyist said. The case is ongoing, and lobbyists say they’re struggling to
read which way it’s heading.
If there’s uncertainty about the direction
of the copyright reforms, the media companies say they at least have this much
in their favor: The mood within the Commission toward technology platforms
appears to have shifted in the past few years.
The previous college of commissioners was in thrall to
Silicon Valley — the “GAFA” group of Google, Apple, Facebook and Amazon — media
companies say. As the U.S. tech companies faced scrutiny over tax affairs,
competition practices and privacy concerns triggered by the Edward Snowden
leaks, there is more skepticism among officials about arguments pushed by the
tech sector in favor of removing online barriers. Perhaps because they’ve got other
fights of their own to worry about, the Silicon Valley giants have been
relatively quiet in the copyright debate.
“It just feels like it’s more of an equal battle right
now than it used to be,” a media lobbyist said.
At the same time, traditional media companies are
getting smarter about lobbying. In the past, big media was often its own worst
enemy. In the early 2000s, for example, record labels sued thousands of
individual Internet users for piracy, creating a huge public relations disaster
while doing little to stem the tide of illegal downloads.
This time, media companies are presenting a united
front. Hollywood studios are standing shoulder-to-shoulder with independent
producers, emphasizing the creative industry’s economic and cultural importance
to the EU.
“There is a general trend toward increasing copyright
term length, without harmonizing the exceptions and limitations that keep
copyrights balanced in the public interest,” said Jan Gerlach, public policy
manager at the Wikimedia Foundation, which fights against such measures. “We
see this trend both in Europe and on a global level,” Gerlach said.
Even so, plenty of media companies are nervous about
where the debate will end up.
Fighting on all fronts, the Commission may push ahead
with sweeping copyright reform despite the rights holders’ objections, feeling
it is a political victory it can achieve.
“They put a lot of pressure on themselves with that
extremely ambitious agenda [at the beginning of Juncker’s presidency], putting
copyright as one of the main objectives,” one lobbyist said. “But unfortunately
they’ve put so much pressure on themselves that I don’t really see how they
could stop.”
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