EU mulls major pay-TV regulation review

The European Union is planning a major review of pay-television and video-on-demand regulation.

Fragmentation of the European media industry is resulting in revenues much lower than in the US and elsewhere, an initial study has found.

It suggests a wholesale review of the industry and the EU's decade-old regulations. Encouraging countries to standardise their law and the industry to unify would be crucial to the project.

A study of the European Commission's conditional access directive says the average revenue per household for the US media industry is "twice as high" as in Europe.

It is because the broadcasting market is divided into individual countries. That means rights and technical issues, marketing and all other functions are duplicated. It also means there is more piracy because protection is not as tight and content rights are more complicated.

The report says the separation would be difficult to overcome because of different language, culture and deep-seated regulatory frameworks.

"To date, European policy has not been successful in reducing these costs," it says. "Yet, unless this issue is tackled at EU level, a growing gap is to be expected between the performance of ISS and media industries in Europe compared to the US."

The report, which calls for interested parties to submit their views on the subject, also raises ISPs' role in tackling piracy and says the EU should even consider a separate review of internet use and peer-to-peer file-sharing.

It notes that the demand for broadband, significantly driven by illegal file-sharing, is actually helping the roll-out of pay-television.

"...P2P piracy is currently raising the willingness to pay for all wired triple-play services," it says. "In the multi-system competition, it enhances the roll-out of digital infrastructure whether it is cable or DSL. The paradox with this form of piracy is that it speeds up the roll-out of digital set-top boxes whose function is to deliver AV content..."

It says the CAD, introduced in 1998 mainly aimed at reducing pay-TV piracy such as illegal decoding, has been successful in improving enforcement. It adds: "However, the implementation of the directive has not been sufficient in eradicating piracy or in promoting cross-border activities."

It says the rules are largely outdated. Another weakness is the "low level" of harmonisation of the law: "Sanctions and enforcement are considerably different across member states, and some safe harbours still exist."

This leads it to consider the issue of ISPs' roles: "The commission should consider opening a debate on the role of access and service providers in contributing to a secure digital media environment...

"The commission should also consider examining more in-depth the whole question of piracy on P2P networks by for instance launching a study on consumer behaviours and expectations on new ISS platforms, as well as a study on the adequacy of the existing EU regulatory framework to deal with P2P infringements."