STUDY CONCERNING MULTITERRITORY LICENSING FOR THE ONLINE DISTRIBUTION

STUDY CONCERNING MULTI-TERRITORY LICENSING FOR THE ONLINE DISTRIBUTION OF AUDIOVISUAL WORKS IN THE EUROPEAN UNION Presentation Europa Distribution 7 th July 2009

FRAMEWORK OF STUDY • Commissioned by DG Information Society and Media of the European Commission • Conducted by KEA European Affairs (Brussels) and Cerna (Mines Paris Tech) • Timeframe: January 2009 – March/April 2010 • Stakeholder workshop in January/February 2010 2

CONTEXT (I) • Key question: Can multi-territory licensing unleash the true potential of a pan-European market for audiovisual content online? • Broadband roll-out across the EU continues • Audiences have to chance to access creative content from anywhere, anytime • Opportunity to overcome bottlenecks in the value chain and develop new markets – inside and outside of a film’s country of origin (Long Tail theory) 3

CONTEXT (II) • For the Commission, the lack of licensing practices covering more than one Member State at a time makes it difficult for online service providers and users to fully benefit from the potential of the internal market • Content service providers must enter into a large number of negotiations to purchase the right to make content available across Europe • Different regulations and practices apply to various types of AV content in each country (release windows, consumer choice, etc. ) 4

POLICY BACKGROUND • “i 2010” – a European Information Society for growth and employment” initiative First Objective: Creation of a “Single European Information Space” • Communication on Creative Content Online Development of “multi-territory licensing for creative content” is one of the four main horizontal challenges • MEDIA Programme “Support to Video on Demand Digital Cinema Distribution” • 2005 Recommendation on online management of music 5

OBJECTIVES OF THE STUDY • Description of the structure of the online distribution sector and the relevant market in EU Member States • Legal analysis concerning the licensing of audiovisual works for online distribution in Member States and at EU level • Analyse cultural and economic impacts of a multi-territory license • Assess challenges for the development of such license in the mid term (5/10 years) • Policy options to foster MTL mechanisms and business models 6

1. BUSINESS TRENDS • Assess impact of digital distribution on audiovisual value chain • Identify the most common commercial practices for the sale of online distribution rights • Examine changes and challenges concerning the exploitation of release windows; film financing, Vo. D roll out, consumption, marketing and promotions, etc. 7

2. ECONOMIC ANALYSIS • Identify stakeholders in the value chain, analyse business models and market for online distribution of av works in all MS • Assess the potential development of intra-Community online trade of av works online • Present and analyse a sample of av works being distributed online, which demonstrates the economic aspects of the distribution of works in various channels 8

3. LEGAL ANALYSIS • Identify and analyse current legislation (civil law, administrative and fiscal laws, etc. ) at MS level • Identify and analyse EU regulations and policies that seek to improve cross-boarder av services and facilitate rights licensing • Assess whether these measures sustain or support the development of pan-European licensing 9

POINTS FOR DISCUSSION • Does Video on Demand present an opportunity to further develop a pan-European market for EU films? How big is this opportunity? • How does digital delivery impact on the role of independent distributors? Are there currently emerging new business models for distributors? • How relevant is the Long Tail theory and what needs to be done to make it work for European film? • How can we facilitate easier pan-European licensing? Should this be left to market forces or should it be subject to regulation? 10 • Do authors recover rights licenced to you on the expiry of

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