Combatting consumer discrimination in the Digital Single Market: Preventing geo-blocking and other forms of geo-discrimination
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1 Combatting consumer discrimination in the Digital Single Market: Preventing geo-blocking and other forms of geo-discrimination CEPS, 05 October 2016 Study prepared for IMCO Committee in cooperation with European Parliament s Policy Department A and IMCO Secretariat
2 A Digital Single Market for Europe
3 A DSM for Europe One territory, one market A Digital Single Market is one in which the free movement of goods, persons, services and capital is ensured and where individuals and businesses can seamlessly access and exercise online activities [ ], irrespective of their nationality or place of residence. (DSM strategy, 2015) 3 Efficiency gains: 415bn/y Consumer welfare gains: 154bn/y
4 A DSM for Europe A long way to go Business Online sales 26% of total sales 10% from other EU MS 4% from outside the EU 41% of EU retailers sell online 12% to other EU MS 14% to third countries 4 Consumers 53% buy online 16% from other EU MS 9% from third countries
5 A DSM for Europe Geo-blocking % 97.2% 72.4% 49.2% 41.9% 36.6% Sent to same website Find same product Can register successfully Can have product delivered Possible to pay Can enter payment detail successfully 90% of consumers experienced some types of geo-blocking 63% of companies experienced some types of geo-blocking 45% of companies confirmed put in place geo-blocking
6 A DSM for Europe Justified restrictions: a slippery slope? Unjustified geo-blocking No objective justifications Purely commercial reasons 6 Justified geo-blocking Legal obligations (copyright law, gambling and alcohol, advertising, protection of minors, etc.) Adaptation costs due to regulatory constraints and other obstacles Business freedom (stay small)
7 The DSM for copyrighted content
8 The DSM for copyrighted content The elephant in the room 8 The largest e-commerce sectors in the EU 33% of online trade by individuals in 2014 The most promising segment of the DSM No (or few) delivery costs The most geo-blocked 70% of providers put in place geo-blocking 72% of providers limit portability Territoriality + territorial licensing Short-term migrants & travellers* Short-term migrants & travellers** Linguistic minorities** Long-term migrants*** Foreign language Foreign language skills (actual)**** skills (potential)**** Cross-border portability Cross-border trade
9 The DSM for copyrighted content Portability Proposal 9 Enable consumers having lawful access to online content services in their country of residence to use the same services also when they are in another Member State for a limited period of time Unsettled issues Residence Temporary presence Verification mechanisms Roaming for Netflix? Short-term migrants & travellers* Short-term migrants & travellers** Linguistic minorities** Long-term migrants*** Foreign language Foreign language skills (actual)**** skills (potential)**** 05 October 2016 Cross-border portability Cross-border trade CEPS
10 The DSM for copyrighted content Interplay between competition and copyright 10 Formal antitrust investigation Statement of Objections to Sky UK and six major US film studios Contractual limitations to passive sales and absolute territorial exclusivity
11 The DSM for copyrighted content Copyright reform 11 Directive on copyright in the DSM Audiovisual works on VoD platforms Assistance of an impartial body to negotiate and reach agreements Regulation for online transmission of broadcasting and retransmissions of television and radio programmes Broadcasters: Country of origin Retransmission: Collective management organisations
12 Thank you for your attention. Felice SIMONELLI CEPS_thinktank DISCLAIMER: Product names, logos, brands and other trademarks included in this presentation are the property of their respective trademark holders. These trademark holders are not affiliated with CEPS and they do not sponsor or endorse this presentation and its content.
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