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European Union Wants Netflix & Co. to Finance European Movies

25 May, 2016 By: Erik Gruenwedel

Netflix has a global footprint. Now the European Union wants it and other subscription streaming services to contribute financially, among other actions, to local movie and TV show productions in its member countries.

In a May 25 update to its Audiovisual Media Services Directive, the commission said its “one-size-fits-all” approach to the entertainment industry no longer works in a digital age featuring online marketplaces, search engines, payment systems, social media, video and content-sharing sites.

As a result, the EU is seeking platforms that mandate safeguarding minors from access to digital pornography and violence, and consumers from hate speech. It advocates that audiovisual regulators be allowed to function independently from local governments and industry agendas.

With European TV broadcasters investing about 20% of their annual revenues in original content, the EU is proposing digital distributors such as Netflix and Amazon Prime Video maintain at least 20% European content in their catalogs — a directive both SVOD services currently accommodate. 

In addition, the EU is asking that member states be able to ask on-demand services available in their country to contribute financially to European movie and TV production in their countries.

The commission also says comparable digital services should follow similar rules and, where possible, the EU should reduce the scope and extent of burdensome regulation.

"I want online platforms and the audiovisual and creative sectors to be powerhouses in the digital economy, not weigh them down with unnecessary rules,” Andrus Ansip, VP for the digital single market, said in a statement.

Ansip said that in addition to deregulation in some markets, other channels mandate select regulatory measures to improve user protection and to reach a level-playing field.

“They need the certainty of a modern and fair legal environment: that is what we are providing today,” he said.

Günther Oettinger, commissioner for the digital economy and society at the EU, said consumption habits of TV or videos may have changed, but the values surrounding home entertainment haven’t.

“With these new rules, we will uphold media pluralism, the independence of audiovisual regulators and will make sure incitement to hatred will have no room on video-sharing platforms. We also want to ensure a level-playing field, responsible behavior, trust and fairness in the online platforms environment,” Oettinger said.

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