You have probably already read it: the next year within the EU roaming costs, the additional costs that we pay when we use our mobile phones abroad, will disappear. Good news for people like me who travel a lot in Europe (yes it is possible being a student an travelling a lot), but also for less regular travelers with teenage children. Also good news for Brussels, which can polish tarnished image again.
The next logical step seems, after the phone and the Internet, also to make the television accessible at no extra cost. The so-called Geo-blocking has prevented us watching our favorite television programs abroad, a major source of annoyance as we just sat in the middle of an exciting series, or want to see an important football match. No wonder people in Brussels are thinking to ban geoblocking.
However attractive it may seem, it seems to good to be true. Unlike telecommunications companies, where the abolition of roaming charges is indeed annoying but pose no real threat, stopping geoblocking in the EU could lead to major deforestation among European broadcasters. The big winners are the internet giants such as Netflix, Amazon and YouTube.
Where is the problem? A national television channel buys the expensive rights to TV series and movies, for example Hollywood studios. If a station in a neighboring country also buys those rights of a popular series, such as Game of Thrones, rather transmits on the Internet, chances are that you and I already go see it without geoblocking the latest episodes. This means that our national broadcaster will have fewer viewers and thus less income. The foreign radio deserves nothing extra with the viewers from neighboring countries, because most TV advertisers pay only for viewers in their own country. The same problem occurs when one country buys expensive sports rights and the same race will be broadcast by the public broadcasters in the other country. The pay-TV channel goes wrong, and the citizens of the other country pay through their license fee contribution.
These dilemmas do not apply to the major Internet players, because they can buy at the same time rights across Europe, and their presence in almost all European countries have asked for subscription everywhere. Moreover, different than TV channels, they are able to deliver customized individual ads on the viewer, regardless of where it resides.
Raising geoblocking seems in the short term so attractive to the viewer, but on the long term it will lead to an impoverishment of the TV schedule. Indeed, the national channels will always have less money to create their own programs.
Does this mean that should stick to the old model? Initially, it should be possible, for example for the citizens of one country, for example through a login, their national television to view anywhere in Europe. These stations would increase their own audience and eliminate frustration without undesirable arbitrage effects.
Eventually this will not be enough to compete with the Internet giants. These Internet giants begin to produce their own global programs at this moment. Ultimately, the European television stations will have to cooperate much more, or go together, and should create a joint venture. In this way, the market, and not Brussels, can end Geo-blocking.
Sources
Robinson, D. (2016) EU sets out plan to shake up Europe’s digital market, Financial Times. Available at: https://www.ft.com/ [Accessed: 19 October 2016].
Dalley, E. (2016) Who wants to buy online for less? Choice. Available at: https://www.choice.com.au/ [Accessed: 19 October 2016].
Hey Amir,
Thanks for your post. As I have been in the same situation like you many times before, I also dislike the geoblock but I do understand why they have such a thing. One option for TV channels to stay competitive is to pay another broadcaster if someone is watching from another country (to explain: NOS (Dutch) pays ZDF (German) if I watch the Olympics on the NOS site while being on holiday in Germany). Of course there is a risk of people cheating in this system, so certain rules should be made, but it does help with removing the Geoblock.
What would you think of this idea?
Hi Stijn,
Thank you for your contribution. I believe that the option that you are providing is very limited, meaning NOS pays ZDF, but how does it works for other countries in Europe, besides the bigger countries like France, UK and Germany. In my opinion Geo Blocking means less or selected audience and less chances of the products being successful, which results in less profits. And when the product is successful, there will be more chances of the product getting pirated in the places where it is blocked.
For example internet is full of pirated TV shows which are free to watch on the websites of the producers of those TV shows. By being open to everyone they can earn more money with ads.
I do not believe that geo-blocking is going to end soon judging by what is happening lately. Netflix has made it stricter to access different content by use of VPN while Spotify is not even now present in the whole EU. In addition you mention that these issues are not present to the major internet players however Netflix has really big differences in the content that they provide from a country to another due to these exclusivity rights.
Hi Andrei,
Thank you for your comment on my blog. I just read some information about Netflix and noticed that the video streaming service’s attempts to block Virtual Private Networks (VPNs) are succeeding to a large extent, as many popular VPNs no longer let you watch videos on Netflix. This is a very good strategy of Netflix, but they have not gotten around to blocking every VPN yet, like Hotspot Shield, it is even free (just to be clear, I don’t make use of these programs, as I am satisfied with the content of Netflix in Netherlands has to offer). Have you noticed how people react to Geo Blocking, because I would like to recommend you going to this site and view the comment section. Ofcourse, this sample is not really reliable, one have to do a proper survey, but to give you food for thoughts:
http://www.makeuseof.com/tag/geoblocking-circumvent/
Hi Amir,
Thanks for your post. I understand your point, with the geoblock banning, but I disagree that every TV has to be available always and everywhere. The examples you gave, like seeing a football match or TV series, are indeed good examples, but the only one I think. You don’t have to forget the German and French TV channels for instance, where almost everything have been played in their own language. The TV channels from that countries will not be supporting your development ideas, meanwhile they are the biggest countries in Europe. Next to that, what do you think about the rights of broadcasting a football match. In the UK they will never be a supporter of the idea, because when everyone around the globe is able to watch the Premier League football, Skysports will never benefit from it. In short, I think that banning geoblocking will be developed, but not in the near future. Too many companies and countries will vote against it.
Hi,
Thank for you for taking your time commenting on my blog post. I agree with you that for the countries where almost every channel is in their own language. Hopefully, one day they’ll drop geo-licensing and make content available to the world. While I understand that they must make a profit, instead showing advertisements aimed at their host country, why not show advertisements based on the users IP address? I’m sure it would be a very lucrative gesture for company A to reach out to company B (whose based in another country) and have them pay for ad time on company A’s website because a lot of their traffic comes from users who live in company B’s country. I think it would be a great move!
Hi Amir,
Thanks for you Post! I agree with you that eventually, the Internet Giants will win. Even if the European television stations cooperate, and create a joint venture. My opinion is that services like Netflix are much more widely available on multiple devices. I also agree with the previous comments that Geoblocking is too difficult to ban in the short term. Too many firms benefit from geoblocking and the battle against it will not be an easy one. However, it is going to be interesting to watch it go down. The European Commission has even stated that Geoblocking digital content along land borders may amount to an infringement of the competition rules.
What do you think about this?
Dear Sjoerd,
Thank you for commenting on my blog post. The European Commission sure has stated that it may amount to an infringement of the competition rules. This could a danger for Geo Blocking itself, because there was a leading case on the topic, that is the judgment in the so-called Murphy Case, where the Court of Justice of the European Union (CJEU) ruled that, while exclusive territorial licensing was not a competition law infringement per se, prohibiting the importation, sale and/or use of satellite decoder cards in
another Member State was in breach of EU competition law.
A balanced approach to geo-blocking is required and the fundamental principles that guarantee the freedom to conduct business must be observed. In my view, geo- blocking contradicts the very notion of a single market and therefore must be removed to build a modern European online marketplace. In addition, the International Federation of Film Distributors’ Associations(FIAD) has pointed out the implications of the legislative proposal for the audiovisual sector, the financing of which (both for paid services and for public broadcasting) depends very much on setting distribution agreements and broadcast rights separately for different European territories.