The European Commission has made the creation of a ‘Digital Single Market’ one of its top priorities. By the end of next year, Europe’s 28 media markets will be unified into one, which is going to have a profound – and mostly positive – impact on various players in the video advertising food chain. Here Charlie Johnson, VP for UK and Ireland at Digital Element, explains how consumers, rights holders, content providers and advertisers and are likely to be affected.
Across the EU there are common guidelines on safety and the environment, and it is relatively easy to live or work in another EU country – it is even possible to drive from Copenhagen to Lisbon without once having to show a passport. Yet when it comes to accessing digital content, the EU is still split into 28 distinct national markets.
Online content rights vary by country, meaning users who have paid to view content in one country may not be able to view it in another. Take the UEFA Champions League as an example. In the UK, BT Sport is the only broadcaster with the rights to show live games, while in France the rights are shared by beIN sports, TSN, and RDS. As a result, a Chelsea supporter who has subscribed to BT Sport is not able to watch his team playing in the final if he happens to be working in Paris – even though he has paid for the right to watch the game.
There is a growing demand for change in legislation as – according to the Digital Agenda Scoreboard 2015 – a quarter (25 percent) of Europeans seek to access music and video from their home country while travelling, and one in five (18 percent) want to access content from other EU countries while at home. And it seems these demands may well be met as creating a Single Digital Market is one of ten priorities set out by the current EU Commission President-elect, Jean-Claude Juncker.
So what will the implications of a Single Digital Market for Europe mean for content providers and video advertisers?
A borderless digital future where consumers have uniform EU-wide access to digital content would either mean our Chelsea fan working in Paris would be able to access BT Sport in France, or BT Sport would need to enter into a shared content rights agreement with French broadcasters. In May the EU Commission set out 16 initiatives to establish the Single Digital Market including one designed to introduce a single EU copyright.
Single media offerings do not currently exist; even for content providers operating in multiple countries. For example Spotify’s subscription service varies from country to country because there is no global or EU license for music rights. A single EU copyright will improve cross-border access to content – specifically ensuring users who purchase films, music or articles at home can enjoy them while travelling across Europe.
This presents an interesting opportunity for the advertising community, who will see a number of new targeting options appear. For example BT Sport’s lead sponsor around UEFA may have the opportunity to expand its advertising across the EU, or BT Sport may prefer to sell advertising space to a more targeted advertiser looking to reach UK sports fans travelling abroad. Video advertising companies will benefit from reduced geographical restrictions, opening up new market streams and widening their reach.
Many questions around the Single Digital Market are still being considered and debated. Demand for streaming services such as Amazon Prime and Netflix is likely to increase if customers can access them while travelling. While these services currently offer advertising-free content at home, they may be able to show advertising in other EU countries, opening up new premium video markets. The Single Digital Market will not only impact online content such as music and video, but it will also enable uniform e-commerce rules across the EU, making it easier for consumers to shop online from another EU country. This will increase the demand for pan-EU video advertising as brands compete for sales across a far wider geographic area.
While the EU Commission is pushing for a Single Digital Market for the European Union, this won’t mean the end of geolocation. In fact, it will increase the demand to know where the user is. At an entry level, geoblocking will need to be maintained to protect content delivery outside of the EU. However, as Europe deepens its borderless connection it will become even more important as analytics remains key to harnessing commercial opportunities. Device derived data, married to an IP address and not being personally identifiable will become key to maximising all the opportunities, from advertising to ecommerce, that a single digital market can deliver.
The creation of a Single Digital Market for Europe will open up a host of opportunities for content providers and advertisers to reach a wider pan-EU audience, as well as targeting specific audiences as they travel across the continent. The time has come for planning and preparation as the Single Digital Market is likely to become a reality sooner rather than later.