EC launches online content consultation

Aleksandra Bosnjak, Analyst

The European Commission recently launched a public consultation entitled 'Making Europe's online content market more competitive'. The objective is to stimulate the growth of a single European market for online digital content, such as films, music and games, and encourage the development of innovative business models and promote the export of EU content. Its secondary aim is to learn how European technologies and devices can be successful in creative online content markets. Input to this consultation will help shape a 'Commission Communication on Content Online', due to be adopted at the end of the year. The deadline for replies is 13 October 2006.

The emergence of digital content delivery has created a number of economic challenges for Europeans that reflect the heightened level of global competition for content production revenues. Over the past decade, several factors have come together to make the environment more competitive for European content producers:

• the Asian market's shift to become the global media hub in terms of both production and consumption across all content categories
• the rising euro
• the introduction of film, TV and new media tax incentives in several North American and Asian territories
• the emergence of 'global domestic' audiences, which prefer to consume home-grown content regardless of where they are located in the world, thanks to all kinds of emerging time/place shifting technologies, but above all the Internet.

As a result, broadband technology combined with increasing competitiveness of other content markets has created business conditions that threaten the long-term competitiveness of the European content production industry. More than ever, it's important that the European content industry has a highly efficient financing environment for production. It is crucial that European content producers have access to the most efficient technologies and innovative financing tools, certainly the equivalent of those available to content creators in other markets, and that these tools are available on competitive terms.

We agree that some form of European policy framework is needed to stimulate the volume of export and domestic consumption of European content. However, above all we believe that all stakeholders should be brought to the discussion table, especially new entrants to the content delivery world such as telcos. The way forward is to define how these new 'front-line' players can be engaged in a proactive discussion but, most importantly, how they can be stimulated via innovative incentives to support the expected renaissance in European content in the coming years.

Aleksandra Bosnjak is a content and media analyst for Ovum's Broadband Content and Mobile advisory services. She is currently working on a number of broadband content topics, including IPTV regulatory issues and IPTV marketing strategies.