Resistance is growing within the European film industry to the European Commission’s plans for copyright reform as part of its Digital Single Market (DSM).
Germany’s exhibitors association HDF and the German Producers Alliance issued communiqués this week criticising Digital Commissioner Günther Oettinger’s proposals to abolish the principle of territoriality in copyright.
HDF said that it “stood united“ behind Culture Minister Monika Grütters’ rejection of the EU plans for the DSM, which it described as “a massive attack on the currently existing windows and business models.”
And Alexander Thies, board chairman of the German Producers Alliance, said: “If it is no longer possible to implement tailor-made distribution strategies for certain countries because everyone can have access to this content from all over, then the refinancing of our productions will be considerably complicated and may even be prevented.”
Meanwhile, in the UK, six executives of the leading film industry trade associations – IFTA, PACT, FDA, CEA, BVA and COBA – joined forces to issue an open letter - “EU threat to films” - published in The Daily Telegraph, highlighting their concerns about the British Government supporting “in principle” the European Commission’s proposals.
“The Government should work with the industry on a market-based solution to expand cross-border content, but maintain incentives for new projects,” they concluded.
Speaking to Screen during a visit to Berlin, the Motion Picture Association’s Stan McCoy, who was also a signatory of the open letter to The Daily Telegraph, declared: “Speaking for the MPA and its members, we like living in a diverse marketplace where we have the contractual freedom to make deals with small players, big players, national or multi-national players as the demands of the market and the consumer dictate.”
McCoy, who succeeded Chris Marcich as the MPA’s President & managing Director Europe Middle East & Africa this January, pointed out that the unintended consequences of the Commission’s market interventon “are very worrisome because there are potential impacts for film financing, and for the viability of co-production agreements that are currently essential for the European film market.”
“The existing framework already permits multi-territory offers such as Netflix where you will already find many programmes that are available in many countries. If there is sufficient demand from the consumer, the market will react,” added Christiane Stuetzle, head of the German film law practice at Morrison Foerster in Berlin.
“The legal framework already allows the free market to react to what the consumer wants, so why change it?,” she noted.
Stuetzle also pointed to the importance of the aspect of cultural diversity “because, particularly in the television sector, producers are required to make a tailor-made product for consumers in a specific territory. If you were forced to offer it to 28 countries in the same form, then there is nothing left of cultural diversity.”
She argued that the key to this objective is “preserving the freedom to serve Europe’s diverse markets in the way that best meets the needs of individual markets and individual productions, and as a consequence, consumers.”
“The Commission keeps emphasising the number of consumer responses to its consultation [on the review of EU copyright rules], but if you calculate the percentage of actual European consumers in those responses, it is infinitesimally small,” McCoy added. “Citing that statistic is somehow to make up for the fact that there is no evidence basis to suggest that change to the copyright system in the EU is going to add one more job or one more Euro of GDP beyond what the creative sector already contributes [i.e. 7m jobs and € 509 bn].”
Indeed, although Commissioner Oettinger constantly recites the mantra of wanting a balanced solution, and aiming for wider choice and access for consumers and rights-holders alike, elsewhere in the Commission the question of removing the principle of territoriality has resulted in a different conclusion.
In a report commissioned by DG Market from Charles River Associates, the authors noted that “perhaps counter-intuitively, a total ban on territorial licensing might decrease, rather than increase, consumer choice.“
“This could happen along two dimensions. First, because the ability of the original rightholders to efficiently extract the rents generated by their content in the retail markets might decrease, they could have weaker incentives to invest in the production of new content which would then in turn decrease the availability of new content for consumers. Second, a scenario is possible where the price for access to content in some territories might increase.”
“All the analysed policy changes carry a significant risk of substantial disruptions to business practices which could undermine their expected benefits,” the report concluded.
Moreover, resistance to Oettinger’s proposals received a significant political boost when the German and French Ministers of Culture, Monika Grütters and Fleur Pellerin, travelled to Brussels to meet the European Parliament’s new Intergroup on Creative Industries earlier this week.
Among various issues including the ongoing discussions about the Transatlantic Trade and Investment Partnership (TTIP) and the reform of the Audiovisual Media Services Directive, both ministers expressed their concerns about the threats to the European film and television industries posed by the Commission’s copyright plans.
In addition, yesterday (March 4) saw the launch of the Association of European Coalitions for Cultural Diversity (CEDC), headed by former Labour MEP Carole Tongue.
Speaking to the EurActiv news service ahead of the launch, Tongue explained that the CEDC – with members in 13 European countries including France, Germany, the UK and Spain - was being launched in response to “an urgent situation.”
“Funding for creative works, EU cultural policies and authors’ rights are under threat in the digital age, and we mean to share our experience on these issues,” she explained. “The Commission is right now looking at narrowing the debate by overstating the geo-blocking problems. The risk is that this will create the ideal conditions for huge platforms that will dominate the market.”
„This is less an issue of copyright than of business models: if platforms do not offer the same thing everywhere, that’s their problem,“ Tongue argued. „Let’s face it, only 3 % of the EU population lives abroad, and only 2 % travel regularly enough to need portable services. The markets are just not big enough for big platforms. So it’s a mistake to believe that portability will answer the question.“