Planned European regulation of new media could damage the emerging European new media industry, according to a report commissioned by UK broadcast regulator Ofcom. Ofcom itself has warned of the dangers of over-regulation.
The European Commission has signalled its intent to replace the Television Without Frontiers (TVWF) Directive with a new framework that would regulate not just traditional television but new media TV-like services. The move towards an Audiovisual Media Services (AVMS) Directive is opposed by business groups who claim that extending TV rules to new media will discourage new business in Europe.
In relation to internet-delivered television services (IPTV), the study, conducted by RAND Europe, found that while 'walled garden' services controlled by broadcaster-like companies could be regulated, a more internet-like 'open access' style of content delivery would involve content producers outside of the EU and therefore the scope of any Directive.
If that open access model is adopted, any Directive could discourage web-broadcasting business to be established in the EU, said the report.
The study found that the new AVMS Directive "could itself be a contributory cause of the migration of economic activity towards this ‘open-access’ model, but clearly, the heavier and less practicable the EU regime, the more likely it is that distributors will favour alternate means to address consumers."
It said that the market for TV-like content had changed more quickly than regulation had. "The single point of control assumed in most broadcasting and telecoms regulation has given way increasingly to clustering, hybridisation and agglomeration of skills within virtual organisations, in ways that have not been reflected fully in regulatory impact analyses."
The report found that the increased costs associated with heavy regulation could force companies that otherwise would establish themselves in the EU to move elsewhere. Ofcom said that, based on the report, its view was that regulation should be light.
"Legislators should ensure that there is clear guidance to the Commission and national authorities to ensure that the implementation of the Directive is conducted in a proportionate, transparent, evidence-based and light touch way," said an Ofcom statement. "Critical to this is to encourage that IPTV and mobile multimedia industries, amongst others, play a full part through self and co-regulation in shaping the rules that will apply to individual industry sectors."
Ofcom even said that the Commission should question whether regulation was needed at all. "The Commission should examine whether or not there is a continued need for regulatory measures," it said. "Over-regulation risks otherwise driving key strategic activities outside of the EU."
Earlier this year business lobby group the CBI said that new media content should not be regulated as if it were television. "TVWF as drafted would shoehorn digital content providers into rules designed for traditional broadcasters, undermining high-value, high-tech economic growth when it should be stimulating it," said the group.