# EUR-Lex - 52013DC0231 - EN

*|*

# 52013DC0231

**GREEN PAPER Preparing for a Fully Converged Audiovisual World: Growth, Creation and Values /* COM/2013/0231 final */**

			*

			*

TABLE OF CONTENTS

1........... Introduction.................................................................................................................... 3

2........... Growth and Innovation................................................................................................... 4

2.1........ Market considerations.................................................................................................... 5

2.2........ Financing models............................................................................................................ 8

2.3........ Interoperability of connected TV..................................................................................... 9

2.4........ Infrastructure and spectrum........................................................................................... 10

3........... Values.......................................................................................................................... 11

3.1........ Regulatory framework.................................................................................................. 11

3.2........ Media freedom and pluralism........................................................................................ 13

3.3........ Commercial communications......................................................................................... 15

3.4........ Protection of minors...................................................................................................... 16

3.5........ Accessibility for persons with
disabilities........................................................................ 17

4........... Next steps.................................................................................................................... 18

GREEN PAPER

Preparing for a Fully Converged
Audiovisual World: Growth, Creation and Values

1.           Introduction[1]

The objective of
this Green Paper is to open a broad, public discussion on the implications of the
on-going transformation of the audiovisual media landscape, characterised by a steady
increase in the convergence of media services and the way in which these
services are consumed and delivered.

Convergence can be
understood as the progressive merger of traditional broadcast services and the internet.
This results in viewing possibilities extending from TV sets with added
internet connectivity, through set-top boxes delivering video content ‘over-the-top’
(OTT)[2]
to audiovisual media services provided via PCs, laptops or tablets and other
mobile devices. Consumers use tablets or smartphones while simultaneously watching
TV, for instance to find out more about what they are watching or to interact
with friends or with the TV programme itself.

Lines are blurring
quickly between the familiar twentieth-century consumption patterns of linear broadcasting
received by TV sets versus on-demand services delivered to computers. Moreover,
with every smartphone enabling converged production as well as consumption,
there might be a future shift from ‘lean-back’ consumption to active participation.

It is expected that
connectable TVs will move from 40.4 million devices end of 2012[3] to a presence in a majority of EU
TV households by 2016[4].

As regards usage of the
functions enabled through added connectivity to the internet, the reported rate
in the UK in 2012 – which is the highest in the EU - as 11 % of the
installed base, in comparison with 44 % in China, 18 % in Korea and
17 % in India[5].
In the US, an increase from currently 22.5 % of US households using
connected TVs including OTT connections and game consoles to up to 43.1 %
is foreseen by 2016[6].

While linear general
viewing times are still around 4 hours a day across the EU[7], the converged experience progressively
becomes a reality and market players develop and adapt business models. Technology
already allows the user to create, distribute and access all types of content
irrespective of time, place or device. The Commission’s vision is to seize the
opportunity of this changing technological environment to ensure the widest
possible access to European diversified content for all Europeans and, the widest
choice of high quality offers. The technological ability to deliver content to
be legally accessible to viewers throughout the EU could also incentivise market
players to create new types of content.

The need for private
economic actors to further innovate and for policy makers to ensure the right
framework conditions, and to reflect on possible public policy responses,
results in the following questions:

- How to transform
the process of convergence in a larger European market into economic growth and
business innovation in Europe (chapter 2)?

- What are the
implications of convergence for values such as media pluralism, cultural diversity,
and the protection of consumers, including specific groups such as minors
(chapter 3)?

As convergence will
become gradually more tangible over the next decade, it might have an impact in
future on a number of legal instruments including the Audiovisual Media
Services Directive (AVMSD)[8]
– focus of this paper -, the E-Commerce Directive[9] and the electronic
communications framework[10].
The consultation does not presuppose any specific outcome. Nonetheless, it may
pave the way towards possible regulatory and other policy responses in the
longer term, in particular linking up Commission initiatives such as the Better
Internet for Kids Coalition[11],
possible activities to follow up the report of the High Level Group on Media
Freedom and Pluralism[12],
as well as work on self-regulatory initiatives.

2.           Growth
and Innovation

In 2012, 22 %
of EU citizens used a mobile device to access the internet[13]. By 2016, the majority of consumer
internet traffic in volume is expected to be video and the majority of IP
traffic to be channelled mainly through WI-FI and mobile devices[14].

Key figures — audiovisual content consumption moving online Consumer spending on digital video (movies and TV series delivered over the Internet) reached € 364.4 million in 2011 (+41,8% vs. 2010) in Europe within a market of physical and digital videos amounting € 9493.8 million (-4.6% vs. 2010)[15]. The unmet demand for VoD services from pay-TV operators from other Member States is estimated to be in the range of € 760 million to € 1,610 million annually[16]. Internet video users are expected to increase globally to 1.5 billion by 2016, up from 792 million in 2011[17]. 306 video-on-demand (VoD) services in the EU in the third quarter of 2012[18]. 72 hours of video are uploaded to YouTube every minute.

For equipment
manufacturers and technology developers, opportunities exist to serve a growing
market with innovative devices including user-friendly interfaces and
accessibility solutions. Network operators will see increased demand for
bandwidth with a positive impact on investments in high-speed networks. Content
creators can find new ways to maximise their audience, monetise their works and
experiment with creative ways to produce and offer content. Broadcasters can
find more platforms[19]
to distribute their content and enhance their interactive offerings.

The key elements for
this potential to materialise are familiar: a big enough market to grow, a
competitive environment, a willingness to change business models, interoperability
and an adequate infrastructure. To shape the future of media driven by the
internet, Europe needs to put those elements into place while fostering the
values underpinning the regulation of audiovisual media services.

2.1.        Market considerations

The EU is
characterised by cultural and linguistic diversity which is a potential
competitive advantage on the world market, but has also been considered a
challenge in an environment characterised by network effects.

Network effects in
the media and internet world may lend a significant comparative advantage to
operators and providers who operate legally in a borderless market enabling
them to raise sizeable budgets and take advantage of economies of scale.
Entrants who offer audiovisual content online without territorial access
restrictions can turn the over 368 million EU internet users[20] into potential viewers and
thus challenge the position of traditional players. This is often the case of
US players who address the EU’s fragmented market successfully.

In Europe, the
consumer experience with audiovisual media services delivered online still remains
often one of limited choice and of disabling access based on often geographical
delimitations. Applications in smart
TV sets are often restricted by national settings and manufacturers’
pre-selected choices and access to content from other EU countries is often
blocked.[21]

Technology will help
to overcome these obstacles. Content producers, subtitle providers and
researchers have started to create alliances to share the available language
resources (e.g. the subtitle corpora[22]
held by producers) and tools[23].

Consumer experience of the future

a) A Polish student spending her Erasmus year in London can access
all the audiovisual offers from Polish operators with her Polish credit card —
just the same way she used to do in Kraków, as Polish services are provided to London.

b) Her flatmate is from the UK and is writing a thesis on works by
Portuguese directors. He can easily access material from Portuguese audiovisual
content providers. The flatmates frequently watch together sports events from various
EU countries.

The Green Paper on
the online distribution of audiovisual works sought to shed more light on
issues mainly related to copyright[24].
The Commission will publish the results of that consultation in 2013. In
December 2012[25],
the Commission re-affirmed its commitment to work for a modern copyright
framework and agreed on two parallel tracks of action: a structured stakeholder
dialogue in 2013 to address a number of issues (including cross-border
portability of content and access to audiovisual works) where rapid progress is
needed;. and the completion of market studies, impact assessments and legal
drafting work, with a view to a decision in 2014 whether to table the resulting
legislative reform proposals[26]..
Copyright matters will therefore not be covered in depth by this paper.

From the supply
point of view, the media world today is one of competition for the attention of
consumers. Market players (e.g. pay-TV operators, free to air public service
and commercial broadcasters, VoD distributors and device manufacturers) try to
differentiate their offers by providing premium or attractive content,
including on an exclusive basis or user-friendly interfaces. Increased content
offer in terms of quantity and diversity is changing the entertainment
landscape.

In 2009[27], EU broadcasters invested
around one third of their revenues in content. Out of the €34.5 billion
programme spend in the EU by broadcasters approximately €15.6 billion was spent
on acquiring rights – €5.8 billion on sports rights and €9.8 billion on film
and TV acquisitions[28]. Premium content (major sport
events and successful recently released films, so-called blockbusters)
generates a high demand and significant revenues in the audiovisual sector. BT's
participation in the Premier League's tenders for the television rights to its
football matches over the three seasons commencing in 2013/14 resulted in a
record £ 3 bn, a 71 % increase[29]
over the previous three-season deal. In the US, Netflix spend an estimated $ 4.8 bn
buying streaming content in 2011/12.

Success may depend
on the ability to consistently offer such content to viewers. While exclusive
deals between platform operators and content providers have formed the basis
for content producers to amortise their investments, they may also restrict the
possibilities of third parties to provide such content to their audiences. These
may constitute barriers to entry for new players.

Moreover, when
platforms reach a high popularity among users and become a key channel for
content providers to reach audiences, the concern may arise that these
platforms could favour certain companies or their own services, in the case of
vertically integrated companies. In addition, these platforms' access to a wide
range of user data may give them an additional competitive advantage[30]. Certain Member States such as
the UK have assessed the need to impose ex ante wholesale release obligations
for access to live top-flight sports and first-run Hollywood movies, considered
essential for competitors to be viable in business.

EU competition rules
are used at national and European level to address possible abuses of market
power in circumstances where a company holds a dominant position in a relevant
market. In that context there is a need to ensure that a quick and effective market
is possible in an increasingly converged world.

The Commission has
intervened on several occasions to ensure competition in the joint selling of
sports media rights[31].
It has accepted remedies in the context of merger cases to ensure that premium films
and sports rights content remain accessible[32].
In this context, case law of the Court of Justice of the European Union (CJEU) on
refusals to licence can be noted[33].
The refusal by a right holder enjoying a dominant position to give access to a
product or service indispensable for carrying on a particular business may be
abusive if that refusal prevents the emergence of a new product for which there
is a potential consumer demand, that it is unjustified and such as to exclude
any competition on a secondary market. Finally, in the Premier League case, the
CJEU held that while EU competition law does not preclude a right holder from
granting to a single licensee exclusive broadcasting rights over a sporting
event in one or more Member States, a right holder cannot prohibit the
exclusive licensee from effecting any cross-border provision of services that
relate the broadcasting of such a sporting event[34]. This is because such a
prohibition would enable the licensee to be granted absolute territorial
exclusivity in the area covered by its licence, thereby eliminating all
competition between broadcasters and partitioning the internal market in
accordance with the scope of the exclusive broadcasting rights.

Competition-related
considerations also arise with regard to the financing of public service
broadcasters. Public service broadcasters often extend their activities to the online
world with applications or webpages. While some actors welcome this extension,
others perceive this as a direct competition with their commercial offers,
which do not benefit from public funding. In 2009, the Commission adopted a
Communication on the application of state aid rules to public service
broadcasters in the light of new technological developments, including the
multiplication of distribution platforms and technologies. The Communication
requires the introduction of an ex ante test. This involves a public
consultation regarding significant new services launched by public service
broadcasters, thus allowing the Member State to assess the impact of a new
service on the market and to balance it against its value for society.

QUESTIONS FOR PUBLIC CONSULTATION:

(1)
What are the factors that enable US companies to
establish a successful presence in the fragmented EU market despite language
and cultural barriers, while many EU companies struggle?      What are the
factors hindering EU companies?

(2)
What are the factors affecting the availability
of premium content? Are there currently practices relating to premium content
at wholesale level which affect market access and sustainable business
operations? If so, what is the impact on consumers? Is there a need for
regulatory intervention beyond the application of existing competition rules?

(3)
Are there obstacles which require regulatory
action on access to platforms?

2.2.        Financing models

Progressive convergence, changing consumer
behaviour[35]
and emerging new business models impact the financing of audiovisual production.

The formats of TV
programmes and series[36]
are increasingly traded within Europe — sometimes adjusted to local tastes —
and exported to other parts of the world[37].
There seems to be a potential for more cooperation on productions where
language barriers are lower, e.g. programmes for children or documentaries. In
addition to TV shows developed by professional producers, user-generated
content can also reach significant audiences, possibly integrated by
broadcasters in their linear schedule. In addition, OTT players might offer
their own series and live TV shows and acquire rights to premium content.

Member States have
developed various ways of promoting European works including diverse ways of
facilitating their production, financing and distribution to a wider audience. The
AVMSD sets mandatory percentages of European and independent works to be
broadcast by EU broadcasters. For non-linear audiovisual media services, the
obligation to promote European works is formulated more flexibly with the
possibility to require financial contributions from broadcasters and on-demand
service providers in order to support the production of European works. However,
while Member States are broadly fulfilling the current legal requirements, they
are concentrating efforts on domestic productions. Non-domestic European works
only make up 8.1 %[38]
of broadcasting hours in the EU.

The trend for VoD
platforms to invest in original content shows that these new players are
potential new investors in audiovisual content. With the dynamic rise of VoD
services and given the current contribution of broadcasters to the production
of European works, there are discussions in some Member States regarding the
contribution to financing of content by internet-based new players directly involved
in its exploitation. This might raise specific issues regarding contributions
from non-European players.

QUESTIONS FOR PUBLIC CONSULTATION:

(4)
Do the current AVMSD requirements provide the
best way to promote the creation, distribution, availability and market appeal
of European works?

(5)
How will convergence and changing consumer
behaviour influence the current system of content financing? How are different
actors in the new value chain contributing to financing?

2.3.        Interoperability of connected TV

Connected TV devices
and services depend on a variety of standards in the broadcasting, IT and
telecom sectors[39].
Convergence reopens the question which approach should be taken towards standardisation,
bearing in mind both its advantages (allowing scale economies and
interoperability) and its drawbacks (risk of freezing innovation).

HbbTV is an ETSI standard applied by a
number of broadcasters, content providers, networks and consumer device
manufacturers in Europe[40]
to link broadcast and broadband content. One[41]
functionality of HbbTV is to trigger broadband content through the broadcast
signal. Another approach is a complete platform solution where broadcasters and
network operators cooperate, such as in the UK example of YouView[42]. In Italy, mainly for
historical reasons, the MHP[43]
standard is used for connected TV.

It appears that a
connected TV set bought in one Member State frequently does not allow
modification of its settings to receive services from other Member States[44] and cannot respond to the
trigger in a broadcast signal legitimately transmitted from another Member
State.

Some manufacturers
may configure their devices to limit the range of services and applications
that can be accessed. Some Member States have developed national specifications
based on HbbTV. In some cases, applications following those national
specifications are not fully compatible with devices in other countries.
Moreover, in some cases specific technical mechanisms (such as Digital Rights Management)
are included in devices to respond to expectations of national players. For
application developers, different standards mean that they need to re-author
their products to different devices[45].

QUESTIONS FOR PUBLIC CONSULTATION:

(6)
Is there a need for EU action to overcome actual
or potential fragmentation and ensure interoperability across borders? Is there
a need to develop new or updated standards in the market?

2.4.        Infrastructure and spectrum

Delivery of multiple
audiovisual content streams in ultra/high-quality definition, including
parallel usage and 3D, is expected — even with improved compression technology —
to increase the bandwidth required to watch content over the internet up to 100
Mbps and beyond. The Commission has set out a comprehensive policy to foster
the development of broadband in the Digital Agenda for Europe[46] and proposed the Connecting
Europe Facility to promote targeted infrastructure investment at European level[47]. Moreover, the Commission
recently carried out a public consultation on specific aspects of transparency,
traffic management and switching in an Open Internet[48] and intends to provide further
guidance on this matter.

Dedicated spectrum
has provided broadcasters with a valuable public resource to enable their own
and others’ programme-making activities. However, a significant net benefit was
identified in reallocating part of the digital dividend realised from switching
off analogue broadcast signal transmission — the 800 MHz band — to develop wireless
broadband access in outlying regions. This was confirmed by the Radio Spectrum
Policy Programme[49],
which set a target of 1200 MHz of spectrum for wireless broadband, putting even
greater pressure on available spectrum resources. Spectrum resources can
facilitate terrestrial and satellite-based delivery of audiovisual content as
well as the interactive functionality necessary for content delivery and
supplementary services. Convergence raises the issue of the future role of
terrestrial broadcasting in the provision of such services. Industry actors are
increasingly exploring hybrid models combining the advantages of broadband in
delivering individual choice of on-demand content with the efficiency of
broadcasting in making content (e.g. live sports or entertainment events)
simultaneously available to a large audience.

QUESTIONS FOR PUBLIC CONSULTATION:

(7)
How relevant are differences between individual
platforms delivering content (e.g. terrestrial and satellite broadcasting,
wired broadband including cable, mobile broadband) in terms of consumer
experience and of public interest obligations?

(8)
What frequency allocation and sharing models can
facilitate development opportunities for broadcasting, mobile broadband and
other applications (such as programme-making equipment) carried in the same
frequency bands?

(9)
What specific research needs with regard to
spectrum have to be addressed to facilitate such development?

3.           Values

The values that underpin
the regulation of audiovisual media services in Europe have resulted in rules
supporting freedom of expression and media pluralism, the promotion of cultural
diversity[50]
protection of personal data as well as the protection of consumers, including
vulnerable groups such as minors and persons with disabilities. The challenge
is to foster respect for those values in a converged environment, via the
appropriate policy choices.

3.1.        Regulatory framework

The main rationale
for the regulation of audiovisual media services at EU level has been the
Internal Market, with the country of origin principle at its core. This ‘single
European TV market’ has entailed a minimum set of common rules covering aspects
like advertising, protection of minors and promotion of European audiovisual
works.

The technology-neutral
approach of the AVMSD means that the same services are regulated in the same
manner irrespective of the device on which they are consumed. However, the
AVMSD makes a distinction between linear (television broadcasts) and non-linear
(on-demand[51])
services, based on the much higher degree of consumer control in on-demand
services, justifying less stringent regulation in certain areas.

The AVMSD rules
apply only to media service providers. The definition of this concept is based
on the notion of editorial responsibility[52].
For as long as a provider has responsibility for the choice of the content and
determines the manner in which it is organised, its services are subject to the
AVMSD even if the content is delivered over the internet.

Linear and
non-linear services will increasingly compete on the same screen, sometimes
even offering over two delivery channels the same content for the attention of
the same audience. With new forms of on-demand content that seem more like
‘lean-back’ linear content, the difference between linear and non-linear
services from the consumer’s point of view might blur. If, in a converging
world, linear and non-linear provision of similar content were to be treated as
being in competition, then the current differences in regimes could clearly
distort that relationship. On the other hand, if the degree of customer control
remains a significant feature for users, then differentiated regulation would
retain a certain logic. This requires policy makers to reflect on the ways in
which these changes will affect both, consumers’ perceptions of the received
service and the effectiveness of current tools.

The AVMSD applies
only to providers under EU jurisdiction. When delivered via satellite, audiovisual
media services fall under the jurisdiction of a Member State if the satellite
up-link is located in the Member State or the satellite capacity used is ‘appertaining
to that Member State’[53].
Those rules do not extend to content delivered over the internet from countries
outside the EU, but targeting the EU.

With media services from
outside the EU increasingly accessible via the internet and satellite, efforts
to establish jurisdiction over those services would imply an assessment of the
need to address overlapping jurisdiction. Similar issues are under discussion
in the field of data protection.

The provision of
non-linear services is also subject to the E-Commerce Directive. In a
converging environment the relationship of this Directive with the AVMSD becomes
more visible[54].
This is also the case for data protection legislation, as the processing of
personal data is often the prerequisite for the functioning of new services,
even though the individual is often not fully aware of the collection and
processing of personal data. The moment data generated during the consumption
of audiovisual media services relates to an identified or identifiable natural
person, it is personal data, and as a consequence falls under the scope of the
EU Data Protection Directive (95/46/EC)[55].
Another relevant regulatory area is consumer protection[56].

Given the global and
complex nature of the internet, self-regulation seems an appropriate complement
to the regulatory approach. In 2012, the Commission launched a process[57] with enterprises and other
stakeholders to develop a code of good practice for self- and co-regulation
exercises. This has led to the drafting of principles for better self- and
co-regulation aiming at ensuring a greater effectiveness[58].

They should be
considered as a benchmark for self- and co-regulation processes which are
already mentioned in the AVMSD[59].

In a progressively
converging world, media literacy becomes also important for audiences,
irrespective of their age. The Commission has developed several policy strands
for media literacy, beyond those included in the AVMSD[60]. Media literacy is understood
as the ability to access the media, to understand and to critically evaluate
different aspects of the media and media contents and to create communications
in a variety of contexts[61].

QUESTIONS FOR PUBLIC CONSULTATION:

(10)
Given convergence between media, is there
evidence of market distortion caused by the regulatory differentiation between
linear and non-linear services? If yes, what would be the best way to tackle
these distortions while protecting the values underpinning the EU regulatory
framework for audiovisual media services?

(11)
Is there a need to adapt the definition of AVMS
providers and / or the scope of the AVMSD, in order to make those currently
outside subject to part or all of the obligations of the AVMSD or are there
other ways to protect values? In which areas could emphasis be given to
self/co-regulation?

(12)
What would be the impact of a change of the
audiovisual regulatory approach on the country of origin principle and
therefore on the single market?

(13)
Does increased convergence in the audio-visual
landscape test the relationship between the provisions of the AVMSD and the E-Commerce
Directive in new ways and in which areas? Could you provide practical examples
of that?

(14)
What initiatives at European level could
contribute to improve the level of media literacy across Europe?

3.2.        Media freedom and pluralism[62]

Media freedom and
pluralism are enshrined in Article 11 of the Charter of Fundamental Rights of
the European Union. The AVMSD[63]
and competition rules, at both EU and national level, contribute to sustaining media
pluralism.

Through the internet,
citizens have access to an unparalleled amount of information and content
beyond national offerings and can participate in opinion making. This
facilitates freedom of expression and enhances pluralism of opinions.

At the same time,
ways how people relate to information change. Filtering mechanisms, including
personalised search results, make it more likely for people to receive the news
in their area of interest, and from a perspective with which they agree. On the
one hand, such filtering and personalisation mechanisms have a clear potential
for empowering citizens, by allowing them to navigate efficiently through the
information overload that characterises the digital environment and to receive
tailor-made services corresponding to their individual needs. On the other
hand, this may decrease the role of the media as editors in the public sphere
and strengthen the role of platform providers, for
example online companies. The latter may not only determine what content is
accessible but can also impact choices, e.g. by varying the prominence with
which certain content is displayed, limiting the citizen’s ability to change
the menu or restricting certain applications. This could influence the de
facto choice for citizens to access media offerings representing a
plurality of opinions and can lead to a situation where citizens potentially find
themselves in a vulnerable situation without realising it. The availability of
various platforms providing valuable content to users, as well as the openness
of those platforms, is an important condition for a thriving media landscape.

Member States may impose
reasonable must-carry obligations on network operators, for the transmission of
specified broadcast channels to the public, if a significant number of viewers
use such networks as their principal means to access these channels[64]. In circumstances, where the
ability to reach audiences is dependent on scarce transmission resources, this
is a way to ensure the provision of specified channels when the availability of
content is considered by Member States to be necessary for general interest
objectives. In the broadband environment, transmission capacity is less of a
constraint on the choice of content available to viewers.

The accessibility of
‘general interest content’, including in the online environment, might be limited
in practice by business decisions, such as those of equipment manufacturers
and/or by the operators of the platforms that can be accessed via this
equipment or indeed by content providers themselves[65].

Member States may
also specify digital broadcasting services to which access must be ensured and
National Regulatory Authorities can impose obligations on operators to provide
access to electronic programme guides (EPGs)[66].

Even if content is
accessible, finding ‘general interest content’ in an enhanced multichannel
environment can be a potential challenge for viewers. Therefore Member States
have also the possibility to impose obligations in relation to the
presentational aspects of electronic programme guides and similar listing and
navigation facilities[67].

QUESTIONS FOR PUBLIC CONSULTATION:

(15)
Should the possibility of pre-defining choice
through filtering mechanisms, including in search facilities, be subject to public
intervention at EU level?

(16)
What should be the scope of existing regulation
on access (art. 6 Access Directive) and universal service (art. 31 Universal
Service Directive) in view of increasing convergence of linear and non-linear services
on common platforms? In a convergent broadcast/broadband environment, are there
specific needs to ensure the accessibility and the convenience to find and
enjoy 'general interest content'?

3.3.        Commercial communications

The AVMSD sets
limits in transmission time for broadcast advertising, such as 12 minutes per
hour, and lays down criteria relating to the advertising of certain products as
well as advertising in relation to minors. Qualitative rules apply similarly to
both linear and non-linear services, while quantitative rules apply only to
linear services. In view of the increasing competition between linear and
non-linear services and the fact that non-linear services might be provided by
providers not subject to EU jurisdiction, European broadcasters fear that such
an asymmetry puts them at a disadvantage.

In the context of
convergence, some innovative advertising techniques put existing rules to the test.
The Commission was informed about concerns regarding commercial overlays[68] over broadcasters’ linear
services and the question whether this could challenge the essential purpose of
advertising regulation, in particular whether such overlays could be shown with
or without the consent of users and broadcasters. Disguised commercial
communications in the online environment could also present challenges.

Personalisation of
content offers can benefit consumers and advertisers, but may depend on tools posing
challenges for personal data protection. European data protection rules[69] can increase consumer trust in
innovative business models which is the stated objective of the Commission
proposals for a reform of the EU regulatory framework submitted in January 2012[70]. The advertising industry has
introduced a self-regulatory[71]
system for online behavioural advertising, which in the future might be
extended to cover video adverts in addition to display adverts. Industry
standardisation initiatives such as Do Not Track (DNT)[72] should also be taken into
account.

QUESTIONS FOR PUBLIC CONSULTATION:

(17)
Will the current rules of the AVMSD regarding
commercial communications still be appropriate when a converged experience
progressively becomes reality? Could you provide some concrete example?

(18)
What regulatory instruments would be most
appropriate to address the rapidly changing advertising techniques? Is there
more scope for self/co-regulation?

(19)
Who should have the final say whether or not to
accept commercial overlays or other novel techniques on screen?

3.4.        Protection of minors

The continuum of
content across the differently regulated linear and non-linear transmission
channels weakens the impact of the current regulatory regime for linear on children’s
access to content. Effective age verification, also for adolescents' access to
content, remains a challenge. Differences in the regulatory approach to different
types of content on screen might moreover make it difficult for users to
determine which authorities to complain to[73].

In ‘A European
Strategy for a Better Internet for Children’ launched in May 2012[74], the Commission argues that
more quality content should be developed for children and that children should
also be protected when they go on the internet. 31 leading companies across the
value chain have signed up to a Coalition to develop, through a self-regulatory
process, appropriate measures for five key actions: i) simple and robust
reporting tools for users; ii) age-appropriate privacy settings; iii) wider use
of content classification; iv) wider availability and use of parental control;
and v) effective removal of child abuse material. Some of these actions relate
to the AVMSD and could be supported by amending the legislation. Collective
results and engagements were made public, including recommendations for best
practices. Companies have produced individual statements regarding the
implementation of those recommendations. The Commission will continue to engage
with the Coalition as a platform for discussing progress through 2013.

QUESTIONS FOR PUBLIC CONSULTATION:

(20)
Are the current rules of the AVMSD appropriate
to address the challenges of protecting minors in a converging media world?

(21)
Although being increasingly available on devices
and platforms used to access content, take-up of parental control tools appears
limited so far. Which mechanisms would be desirable to make parents aware of such
tools?

(22)
What measures would be appropriate for the
effective age verification of users of online audiovisual content?

(23)
Should the AVMSD be modified to address, in
particular, content rating, content classification and parental control across
transmission channels?

(24)
Should users be better informed and empowered as
to where and how they can comment or complain concerning different types of
content? Are current complaints handling mechanisms appropriate?

(25)
Are the means by which complaints are handled
(funding, regulatory or other means) appropriate to provide adequate feedback
following reports about harmful or illegal content, in particular involving
children? What should be the respective roles/ responsibilities of public
authorities, NGO's and providers of products and services in making sure that
adequate feed-back is properly delivered to people reporting harmful or illegal
content and complaints?

3.5.        Accessibility
for persons with disabilities

Technology offers more possibilities to assist visually, hearing and
cognitively impaired persons than ever before. However, these opportunities may
be lost if accessible content, i.e. subtitles, sign language or
audio-description, is not produced or not made available to end users.

The AVMSD already obliges
Member States to encourage media service providers to make their services
gradually accessible to people with visual or hearing disabilities. The
implementation of this provision by Member States varies considerably. Accessibility
services can be included in ‘must carry’ obligations imposed by Member States.

The Commission has
presented a proposal for a Directive on web accessibility[75] and is exploring how to further
improve the situation of accessible goods and services in the EU market and
establishing general accessibility requirements in the forthcoming European
Accessibility Act. The adoption of a European Standard
covering also audiovisual issues related to accessibility is expected by the
end of 2013.

QUESTIONS FOR PUBLIC CONSULTATION:

(26)
Do you think that additional standardisation
efforts are needed in this field?

(27)
What incentives could be offered to encourage investment
in innovative services for people with disabilities?

4.           Next
steps

All interested
parties are invited to comment on the ideas raised in this Green Paper,
including by responding to the specific questions listed, to the following
address:

CNECT-CONVERGENCE-AV@ec.europa.eu

European Commission

Directorate- General for Communications
Networks, Content and Technology

Unit G1

Office BU25 05/181

B- 1049 -Brussels

In this context, the
Commission may organise or participate in meetings with stakeholders, including
industry, consumers, investors, Members of the European Parliament and the
Council.

Please submit your
comments by 31/08/2013. Contributions received will be published on the DG CONNECT
website unless a contributor requests otherwise. It is important to read the
specific privacy statement attached to this consultation for information on how
your personal data and contribution will be dealt with.

[1]               For a glossary of relevant terms see http://ec.europa.eu/digital-agenda/en/connectedTV.

[2]               Over-the-top players provide audiovisual content
online without themselves being electronic communications services and network
providers.

[3]               IHS Screen Digest.

[4]               IHS Screen Digest.

[5]               http://www.prnewswire.com/news-releases/western-viewers-fall-behind-in-the-web-connected-tv-revolution-168126616.html.

[6]               Source: e-marketer.

[7]               Yearbook of the European Audiovisual Observatory,
Volume II, page 171.

[8]               Directive 2010/13/EU of the European Parliament and
of the Council of 10 March 2010 on the coordination of certain provisions laid
down by law, regulation or administrative action in Member States concerning
the provision of audiovisual media services (AVMSD), OJ L 95, 15.4.2010, p.
1–24.

[9]               Directive 2000/31/EC of the European Parliament and
of the Council of 8 June 2000 on certain legal aspects of information society
services, in particular electronic commerce, in the Internal Market (Directive
on electronic commerce), Official Journal L 178 , 17/07/2000, p 1- 16.

[10]             E.g. Article 31 Universal Services Directive, spectrum
policy, Article 6 Access Directive.

[11]             http://ec.europa.eu/digital-agenda/en/creating-better-internet-kids.

[12]             http://ec.europa.eu/information_society/media_taskforce/doc/pluralism/hlg/hlg_final_report.pdf.

[13]             Eurostat 2012 Individuals - Mobile Internet access
(isoc_ci_im_i).

[14]             http://www.cisco.com/en/US/solutions/collateral/ns341/ns525/ns537/ns705/ns827/white_paper_c11-481360_ns827_Networking_Solutions_White_Paper.html.

[15]             International Video Federation Yearbook 2012.

[16]             http://ec.europa.eu/internal_market/media/docs/elecpay/plum_tns_final_en.pdf.

[17]             http://newsroom.cisco.com/press-release-content?type=webcontent&articleId=888280.

[18]             European Audiovisual Observatory; all platforms
considered: pure internet, electronic sell-through, videogame consoles, cable,
IPTV, dedicated STB, smartphones, smart TVs, Push VoD (satellite, DTT) except apps
in iTunes and in the Google Play App Store. Does not include: archives,
trailers, TV series, adult, training, catch-up catalogues of film channels.

[19]             Platforms can be integrated in the device by
manufacturers or provided by other players such as electronic communications
and cable operators, over-the-top (OTT) players or broadcasters.

[20]             http://www.internetworldstats.com/stats9.htm.

[21]             Study on the economic potential of cross-border
pay-to-view audiovisual media services TNS opinion, Plum, the futures company -
Study prepared on behalf of the European Commission – January 2012
http://ec.europa.eu/internal_market/media/elecpay/index_en.htm#maincontentSec1.

[22]             Subtitling companies or film producers/distributors
hold large corpora (databases) of subtitles, often in many different languages
in parallel. This is very valuable raw material to develop customised machine
translation systems.

[23]             E.g. SUMAT (www.sumat-project.eu) and SAVAS (www.fp7-savas.eu) and the ICT Work
Programme 2013, page 47 http://cordis.europa.eu/fp7/ict/docs/ict-wp2013-10-7-2013-with-cover-issn.pdf.

[24]             Green Paper on the online distribution of audiovisual
works in the European Union: opportunities and challenges towards a digital
single market, COM(2011) 427 final.

[25]             Communication from the Commission on content in the
Digital Single Market, COM(2012) 789 final.

[26]             The following elements will be addressed:
territoriality in the Internal Market; harmonisation, limitations and
exceptions to copyright in the digital age; fragmentation of the EU copyright
market; and how to improve the effectiveness and efficiency of enforcement
while underpinning its legitimacy in the wider context of copyright reform

[27]             Report from the Commission to the European Parliament, the
Council, the European Economic and Social Committee and the Committee of the Regions.
First Report on the Application of Articles 13, 16 and 17 of Directive
2010/13/EU for the period 2009-2010: Promotion of European works in EU
scheduled and on-demand audiovisual media services, COM/2012/0522.

[28]             Final study on the implementation of the provisions of
the Audiovisual Media Services Directive concerning the promotion of European
works in audiovisual media services, 13 December 2011.

[29]             http://www.guardian.co.uk/media/2012/jun/13/premier-league-tv-rights-3-billion-sky-bt.

[30]             See also 3.1 on data protection.

[31]             Case COMP/38.173 — Joint selling of the media rights to
the FA Premier League Case, COMP//37.214 — Joint selling of the media rights to
the German Bundesliga, and COMP/37.398 — Joint selling of the commercial rights
of the UEFA Champions League.

[32]             Case COMP/M.2876 Newscorp//Telepiù.

[33]             Case C-418/01 IMS Health, C-418/01, GmbH & Co. OHG
v NDC Health GmbH & Co. KG [2004] ECR I-5039.

[34]             Joined Cases C-403/08 and C-429/08 Football
Association Premier League Ltd & Others v QC Leisure & Others - Karen
Murphy v Media Protection Services Ltd, judgment of 4 October 2011. See
also Commission Communication to the European Parliament, the Council, the
Economic and Social Committee and the Committee of the Regions ‘A coherent
framework for building trust in the Digital Single Market for e-commerce and
online services’ dated 11 January 2012, page 7.

[35]             Declining consumer expenditure on DVDs, -7.7 %
from 2010 to 2011, with consumer spending on VoD growing by 20.1 % to a
total of € 1.2 bn. The European Video Yearbook, 2012, p. 7. Between
2008 and 2010, UK online video viewing time more than doubled to 31 minutes per
day; in France it grew by 104% to 24 minutes/day. Source: Cimscore.

[36]             See footnote 28: According to the study on the
implementation of the AVMSD on promotion of European works, during the period
2006-2008 the export of formats from Europe to North America, South America and
Asia represented 5 084 broadcast hours and the intra-European trade in
formats amounted to 19 995 broadcast hours. The export of formats from
Europe to North America amounted to 2 213 hours compared to 8 363
hours from North America to Europe.

[37]             Examples of formats exported globally and adapted locally
include programmes such as ‘Who wants to be a Millionaire’ and ‘Deal or no deal’
and series such as ‘The Killing’ and ‘The Bridge’.

[38]             See footnote 28.

[39]             These include the DVB broadcasting standards and the
internet protocol for the delivery of content. Others such as MPEG 25 and
HTML-5 for content presentation may play an increasing role in future.

[40]             According to the information available at the time of
writing, HbbTV is already in regular operation in CZ, DK, FR, DE, NL, PL, ES
and CH. AT, FI, NO, SE and TR have either announced plans to introduce HbbTV or
are carrying out trials. There is also interest outside Europe.

[41]             There are also network operator portals and
manufacturer portals based on HbbTV as well as independent applications.

[42]             YouView was launched in July 2012 with its own
eco-system of several companies working together. Like other vertical market
platforms, it does not have a fully standardised architecture.

[43]             MHP, or the Multimedia Home Platform, can be described
as a set of instructions that tell the operating system on a digital TV
receiver how to deal with an interactive TV application it has received. http://www.dvb.org/technology/fact_sheets/DVB-MHP_Factsheet.pdf.

[44]             Discussed in meetings with stakeholders.

[45]             Several players aim to address this issue e.g.: http://www.smarttv-alliance.org;
Open IPTV Forum.

[46]             http://ec.europa.eu/digital-agenda.

[47]             https://ec.europa.eu/digital-agenda/en/connecting-europe-facility.

[48]             http://ec.europa.eu/digital-agenda/en/line-public-consultation-specific-aspects-transparency-traffic-management-and-switching-open

[49]             https://ec.europa.eu/digital-agenda/node/118.

[50]             This is an intrinsic value to be safeguarded in line
with Article 167 TFEU.

[51]             AVMSD Article 1.1.g: "on-demand audiovisual media
service" (i.e. a non-linear audiovisual media service) means an
audiovisual media service provided by a media service provider for the viewing
of programmes at the moment chosen by the user and at his individual request on
the basis of a catalogue of programmes selected by the media service provider.

[52]             This means the natural or legal person who has
editorial responsibility for the choice of the audiovisual content of an
audiovisual media service and determines the manner in which it is organised
(Article 1(1)(d) AVMSD). This excludes natural or legal persons who merely
transmit programmes for which editorial responsibility lies with third parties.

[53]             Art. 2(4) AVMSD.

[54]             See in particular the “internal market clause” in
Article 3 as well as Article 4 and Articles 6 – 8.

[55]             Directive 95/46/EC of the European Parliament and of
the Council of 24 October 1995 on the protection of individuals with regard to
the processing of personal data and on the free movement of such data OJ L 281,
23.11.1995, p. 31–50

[56]             E.g. Directive 2005/29/EC on Unfair Commercial
Practices protects consumers from misleading or aggressive marketing, and
ensures that any claim made by traders in the EU is clear, accurate and
substantiated; and the Directive 2011/83/EU on Consumer Rights regulates
several areas of consumer rights, harmonising some of them. Information on
digital products to be downloaded or viewed online, for example, will have to
carry clear information on interoperability and functionality.

[57]             Communication from the Commission to the European Parliament,
the Council, the European Economic and Social Committee and the Committee of the
Regions, A renewed EU strategy 2011-14 for Corporate Social Responsibility,
COM(2011) 681 final,
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2011:0681:FIN:EN:PDF.

[58]             https://ec.europa.eu/digital-agenda/en/news/principles-better-self-and-co-regulation-and-establishment-community-practice.

[59]             Article 4.7.

[60]             Article 33.

[61]             Communication from the Commission to the European
Parliament, the Council, the European Economic and Social Committee and the
Committee of the Regions "A European approach to media literacy in the
digital environment" COM(2007)833final.

[62]             Please note also public consultations regarding media
freedom and pluralism http://ec.europa.eu/digital-agenda.

[63]             The AVMSD supports media pluralism by allowing
audiovisual media services to freely circulate within the single market, based
on the country of origin principle and e.g. through article 14. This — together
with the specific rules on the promotion of European works — supports media
pluralism.

[64]             Art 31 of the Universal Service Directive 2002/22/EC as
amended by the Citizen's Rights Directive 2009/136/EC.

[65]             In the case of digital television equipment, Article 24
of the Universal Service Directive could be used to ensure interoperability.
Annex VI currently ensures e.g. that signals transmitted in the clear are
displayed on devices capable of descrambling scrambled broadcasts.

[66]             Art 5 (1b) of the Access Directive 2002/19/EC as
amended by Directive 2009/140/EC.

[67]             Art 6 (4) of the Access Directive 2002/19/EC as amended
by Directive 2009/140/EC.

[68]             Visual elements that appear on the screen during a
broadcast.

[69]             ePrivacy Directive and the proposed Data Protection
Regulation amending the current Data Protection Directive.

[70]             COM(2012)11 – Regulation of the European Parliament and
of the Council on the protection of individuals with regard to the processing
of personal data and on the free movement of such data (General Data Protection
Regulation).

[71]             A cross-European self-regulatory Framework for Online
Behavioural Advertising (OBA):
http://www.iabeurope.eu/news/self-regulation-framework.aspx.

[72]             A global DNT standard would describe the technical
details of a ‘signal’ that users can send to providers via their online
equipment, including their web browser. The signal indicates their preferences
regarding tracking. http://blogs.ec.europa.eu/neelie-kroes/donottrack/.

[73]             An example where this issue is addressed is ParentPort.

[74]             http://europa.eu/rapid/pressReleasesAction.do?reference=IP/12/445.

[75]             Proposal for a Directive of the European Parliament and
of the Council on the accessibility of public sector bodies' websites COM(2012)
721 final.