Europe Wants A Single Market For Online Content... But Why?

from the details,-details... dept

Wed, Jan 9th 2008 9:39pm — Mike Masnick

The European Commission apparently thinks that the big thing holding back the rise of a European online content industry is the lack of a single centralized marketplace for digital content that also includes DRM and other anti-piracy safeguards. It's not surprising why they might think this, but they're wrong. It's a politician's solution, rather than a business person's. It's based on the false belief that copyright is a tug-o-war between content creators and consumers that needs balance on either side. That's simply not true. Saying that it is sets up the economics of a zero-sum game where every winner has a loser. However, that's not true with digital content, with its infinite availability, every winner doesn't need to be a loser. You can set up business models that expand a market, rather than limit it. And, of course, the worst way to try to set up such market is to centralize it and make it the government's job. It has all the hallmarks of a totally boondoggle of wasted government money and effort. Instead, why not let various other business models get tested in the marketplace to see what works?

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Filed Under: europe, marketplace, online content

9 Comments

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inc, 9 Jan 2008 @ 10:39pm

No one wants a free market, only guaranteed profits. The problem with giving away freedoms with the false hope that there is a level playing field, is that people lose their ability to compete freely. What also happens is that the playing field is never level so black markets will just take a strong foot hold and flourish. The market should have the freedom to adapt and supply the demand digital good better faster and cheaper then any pirate could. Give users incentive to buy genuine goods over pirated materials. People are not stupid and the times they are a changing. Let them eat cake or somethin'
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Craig Ferrante, 9 Jan 2008 @ 11:23pm

No one wants a free market, only guaranteed profits. The problem with giving away freedoms with the false hope that there is a level playing field, is that people lose their ability to compete freely.
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PaulT (profile), 9 Jan 2008 @ 11:53pm

I think this has something to do with Apple and other retailers not abiding by EU standards on pricing and availability. i.e. If I'm in the UK and a product is cheaper in France, I should be allowed to buy the French product if I prefer. This wasn't possible online with iTunes and other services (albeit more due to licensing than, say, Apple).

It's the wrong solution and will cause more problems in the long-term but at least it's possible to see where they're coming from.
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Oliver A, 10 Jan 2008 @ 2:33am

Apple ignore EU free trade laws in other areas too;

They refuse to let people in the UK buy from the Apple website in other EU countries like France and Germany.

It's only the fact that the price differential in this case is so obvious that motivated Which? Magazine to take them to court.

This Apple settlement really has little to do with digital content laws, just with the fact that apple are spending significant effort in stopping UK consumers from doing business with their stores elsewhere in the EU, illegally.
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Chris Andre, 10 Jan 2008 @ 3:24am

Re:
Actually, the official reason why there are different iTunes stores for the different markets in Europe is that it is easier concerning all the slight differences in the countries' copyright laws. (I don't personally agree with that but, legally speaking, it is something you can defend in front of the European court of law).
Concerning the difference of prices between the UK store and the rest of the European stores, there has been an announcement recently from Apple, indicating they were discussing with the majors to solve this problem. Now, between what has been announced and the reality, there is always a difference...
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Chip, 10 Jan 2008 @ 9:30am

Copyright laws do set up a tug of war between consumer and producer. Copyright and patent laws limit market entry and allow producers to make economic profit, with the consequence of higher pricing. It is through this that incentive to innovate is created. This doesn't necessarily set up a zero sum situation. Producers still want to make and sell music, and consumers are still consuming. The tug of war only results in consumers 'winning' less than they would otherwise. iTunes differentiation between the markets is understandable, given the differences in copyright laws between countries. The EU cannot be considered a common market in the strict sense until consensus is reached on laws and regulations limting factor and product movements between countries, including copyright protections.
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Ima Fish, 10 Jan 2008 @ 10:24am

The US actually has a better solution (for once!)
In Europe everyone is upset that you could not use iTunes songs in non-Apple players or that you could not use DRMed non-iTunes songs in your iPod. So their "solution" in Europe is to come up with one form of DRM to rule them all.

In the US, to get around Apple's DRM/vertical business model, most of the music industry has simply dropped DRM and is selling their music in MP3 format on Amazon. Those files can be played on any MP3 player including the iPod. Problem solved.

God, I'm glad in this one instance that I don't live in Europe. I'd much rather be stuck with no DRM than one DRM.
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Anonymous Coward, 10 Jan 2008 @ 12:41pm

techdirt wrong again (no suprise)
Its amazing how consistently techdirt manages to missunderstand stuff that happens outside of the US (in fact the record for stuff inside the US is not brilliant but it is better).
Imagine we had seperate markets for each state and seperate regulations and price controls, and people with credit cards in one state couldn't purchse things from web sites in another state etc.
Clearly European consumers would benefit from a single market jsut as we do in the US - think of a united Europe.
You use the word "centralized" to give a prejudiced view, but in fact this word has nothing to do with the reality.
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Jorge Durán, 20 May 2008 @ 8:56am

It's about coordination
In technological issues, European success stories are rare in comparison to the US. One exception is mobile telephony and the contribution of the European Commission is clear: while US corporations were fighting to impose their own standard, the Commission helped coordinate European competitors to adopt the GSM standard. It is just about that: coordination to set common rules (as in the US internal market). The role of the Commission is nicely explained in a book by the American journalist J.R. Reid, The United States of Europe, Penguin Books, 2004.
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