How can policymakers maximise growth of the EU digital economy?




Ruth Hieronymi

Since the launch of the Lisbon process in 2000 and the i2010 strategy in 2005, the information and communication technology (ICT) sector has been in the limelight of EU policies. The significance of the ICT sector for the EU's economy is overwhelming, as it is responsible for a quarter of EU GDP growth and 40% of productivity growth. One of the most important areas within i2010 concerns the creation and delivery of information and contents. Information, since freedom of information is at the heart of European democracy; contents, since the creative sector of Europe and its growing cultural industries have an increasing impact on the digital economy.

An open and competitive internal market for information society services needs deregulation where feasible and future proofed approaches. But due to their relevance for democratic and social structures of society, cultural and media services are at the same time cultural and economic services and therefore require a sector-specific regulation.

In order to maximise the growth of the EU digital economy also for media services, the European Parliament has pushed for the audiovisual media services directive (AVMS), which is going to enter into force by the end of 2007 and is going to replace the current "TV without Frontiers" directive.

The AVMS directive covers traditional broadcasting services on the basis of fixed programme schedules in analogue or digital technology (linear services) and additionally, new on-demand TV-like services (non-linear services). With this scope, the AVMS directive creates, for the first time, an internal market for non-linear AVMS on the basis of the country of origin principle. As the definition of AVMS is technology-neutral, this is a future proofed regulation for content.

The new directive provides a two-step approach for the regulation of linear and non-linear AVMS, depending on the level of control the user can exercise on the service. For the first time in an EU-directive, Member States shall encourage co- and self-regulatory regimes at national level, especially for non-linear AVMS services, in order to facilitate a new deregulatory approach for internet-based media services.

To summarise:

o the clarification of the scope for AVMS, independent of the technology of transmission,
o the expansion of the country of origin principle and
o the encouragement of co- and self-regulation

are the new principles which strengthen the digital economy and take into account the cultural characteristics of these services.

With the new AVMS directive, media content is going to be able to circulate freely within the EU. But in the following areas, which support free circulation, an updating of the EU approach and/ or regulation is required to be of benefit to the European digital content market:

o A balanced approach for a frequency management system, that is flexible enough to enhance the creation of new business models, but takes into account the role of frequencies for freedom of information.

o Interoperability is crucial for the development of a digital interactive content industry. The European Parliament supports the use of real open standards guaranteeing interoperability.

o Media Literacy skills need to be strengthened among European citizens to increase citizens' trust in the new digital environment. Media literacy will support citizens' ability to participate fully in the information society and will safeguard them - especially children and minors - against harmful content.

o The European creative sector is a source of high quality content. Its digitalisation and availability on-linewill broaden access for European citizens to film in all its diversity, and will encourage a wider circulation of European works.

o Copyright management, especially for cross-border online content, needs to be adjusted to the digital environment. A future proofed digital rights management needs both to safeguard cultural diversity and to give users easy access to digital content.

The European digital economy is gathering speed, but, in order not to hamper its development, adequate action and guidelines need to be put into practice urgently, especially in the fields of spectrum management, interoperability and copyright management.