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General

Geoblocking is EC's new roaming

Friday 29 January 2016 | 16:13 CET | Background

One of the flagship policies of the current  European Commission is the Digital Single Market (DSM). In the online world, national borders and other barriers are still holding back a single internal market in the EU. As the importance of online services continues to grow, these barriers are becoming a greater problem, according to Andrus Ansip, vice president of the European Commission, in an interview with Telecompaper. The issue of geo-blocking may soon face the same fate as roaming in the EU.

Ansip spoke with Telecompaper in Amsterdam, following an informal meeting of ministers responsible for competition issues. The commissioner presented the EC’s plans on geoblocking at the meeting, and the countries were supportive, he said.

 

The European Commission plans a number of measures this year on the Digital Single Market. The roaming and net neutrality rules passed last year will be the first to take effect. From 01 April, mobile users will pay only a small surcharge for roaming in the EU, and from 15 June 2017, there will be no difference in the cost of roaming and using mobile services at home. The net neutrality rules taking effect 30 April mean ISPs will not be able to discriminate between different types of services and traffic on their networks. The exact details of how the rules will be enforced are still under development.

Sell Like at Home

The next theme of the DSM is the fight against geoblocking. These are trade barriers based on geography or country that affect mainly the sale of goods online. Ansip said it was unacceptable that goods or services online were not available in certain countries. In response, the EC is introducing the concept of ‘sell like at home’. This will include measures such as stopping sellers from redirecting consumers to a website from their home country, with different prices. The buyer’s IP address or country where their credit card is registered should not be a determining factor in where they make a purchase, Ansip said.

Ansip noted hastily that there will be no requirement for online sellers to supply physical goods everywhere in the EU. The EC is not planning to force businesses to sell their products everywhere and definitly not at the same price. The aim is merely to make cross-border sales easier. To support this, the EC introduced late last year a proposal to harmonise contract law for online sales throughout the EU.

It will also work on improving the costs of package delivery. The Netherlands does better in this area than some countries. It costs only 1.6x more to send a package of 2kg in Europe than within the Netherlands, while in some countries the difference is as much as 22x more, Ansip said. The commissioner was ready to illustrate the problems with downloads or postal delivery with any number of statistics and figures. He is focused on allaying concerns that the proposals could limit contractual freedom for businesses or replace local rules and quality standards.

Portability

The EC also wants it to be easier to take online services across the border. In December, the commission presented its proposal on data portabiliy. This should make it possible for consumers to use their subscriptions in any other EU country, rather than be limited by the current practice of national licences.

For example, a person on vacation abroad can’t watch the same TV channels or videos on an OTT service as at home, despite the fact that this should be all the easier now that roaming costs are disappearing. Over a third (35%) of EU citizens are abroad more than 10 days a year, not to mention the many people living around border areas such as Copenhagen-Malmo or Luxembourg-France.

The focus is expressly on portability of subscriptions, said Ansip. The right will not be without limits. Providers will not be required to deliver the same content in the same manner everywhere in the EU.

How the proposal will work exactly still needs to be negotiated by EU members and parliament. Ansip said both the parliament and council have broad support for the initiative, but he declined to give a timeframe for when the system could be in place.

Copyright

The European Commission is also working on a comprehensive harmonisation of copyright law in the EU. It was clear before even starting that this will prove a thorny issue. Copyright is based on national law and protection, and this creates a barrier on the internet to a single EU market for digital goods and services. The commision aims to present in June a proposal for reform. This will also include measures on enforcement and sanctions. Over two-thirds of consumers use free downloads, and 22 percent use illegal downloads when there’s no legal alternative.

The European Commission aims to address this problem, using a ‘follow the money’ approach. Content producers and providers are missing out on income from various sources due to the lack of legal offers on the market. The aim is to ensure that legal option comes. Many consumers already pay a fixed amount per month for a VPN subscription or other services that make it possible to get past content restruictions based on national IPs. This means a loss of income from the content makers.

DSM strategy

Ansip said he is in talks with a wide range of stakeholders, including governments, businesses, consumer groups and end-users. While Brussels has been working for decades on creating the internal market, national borders still exist for online services. And the impact is increasing each day, as electronic products and services take the place of more traditional forms.

The EC has already presented some of its DSM plans and is working on more, including issues such as electronic signatures and the ‘collaborative economy’ of new businesses like Uber and Airbnb. It also wants to convince more start-ups to stay in Europe rather than head to Silicon Valley. As Ansip notes, the EU market counts 500 million people, while the US has just 300 million.



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