Geo-blocking digital content rife in EU, but is it legal?

21 Mar 2016

Despite the EU’s business premise being that it is a borderless, utopian, transport-friendly environment, geo-blocking is rife. But is it legal?

Borderless trading is a fairly straightforward concept. If I have a clothes business in Europe, I should be able to sell the same products, under the same rules, in each country.

But, for various reasons, that is not always the case. Common reasons would be shipping and delivery logistics, for example.

All well and good, you might say, but what about when that no longer applies, like, for example, in digital content sales? Think Netflix, where a user in Cork can’t access the same content when they are on holiday in Berlin.

To get to the bottom of it, the European Commission has produced a report into what is called ‘geo-blocking’, finding that 68pc of digital content providers are happy to offer different content in different countries.

Noting throughout that “non-dominant” retailers don’t necessarily need to serve the entire union, and that ‘just’ 38pc of consumer goods providers geo-block, more than two-thirds of digital content providers deciding against equal offerings throughout the EU is a bit odd.

Margrethe Vestager, the EU commissioner in charge of competition policy, said “agreements between suppliers and distributors” is a growing concern.

Vestager stopped short of saying it’s breaking continental legislation, rather saying it was time for a closer look at whether “there is anti-competitive behaviour”. This would be on a case-by-case basis.

Three-quarters of providers of fictional TV content actively geo-block, with films (66pc) and sports (63pc) also high on the list of content that is subject to geo-blocking.

IP addresses are the main way companies choose which users can access content, with 59pc of the responding content providers indicating that they are contractually required by suppliers to geo-block.

A more detailed analysis is expected later this year.

Main image via Shutterstock

Gordon Hunt was a journalist with Silicon Republic