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The Office of Communications (Ofcom), the UK communications regulator, commissioned a research report on the draft Audiovisual Media Service (AVMS) directive proposed by the European Commission in December 2005, as an extension to the Television Without Frontiers (TWF) Directive.
The AVMS directive was proposed as a new regulatory framework to cover not only traditional television but also new media TV-like services.
The business groups are opposed to the proposed directive considering it will discourage new business in Europe and the same rules that are applied to television content should not be applied to new media. The business lobby group CBI said :"TWF as drafted would shoehorn digital content providers into rules designed for traditional broadcasters, undermining high-value, high-tech economic growth when it should be stimulating it."
European media scholars have also criticized the directive, considering it might have a negative impact on the Internet.
The research report performed by RAND Europe examined the impact of the proposed regulations on Internet Protocol TV (IPTV), online games and mobile multimedia.
Regarding the IPTV, the study conclusion was that a more internet-like 'open access' style of content would also involve producers from outside the EU and therefore the directive could discourage the establishment of web-broadcasting business in the EU.
It says that AVMS Directive "could itself be a contributory cause of the migration of economic activity towards this 'open-access' model, but clearly, the heavier and less practicable the EU regime, the more likely it is that distributors will favour alternate means to address consumers."
The conclusion of the report is that the proposed AVMS does not offer companies, especially SMEs, sufficient regulatory certainty to encourage investment in EU and that the costs involved by the heavy regulation could make companies move outside Europe.
Based on the report, Ofcom questioned whether the Directive should exist at all. "The Commission should examine whether or not there is a continued need for regulatory measures. Over-regulation risks otherwise driving key strategic activities outside of the EU."
In the event the Directive is implemented, Ofcom said that the regulation should be light and clear guidance should be provided to the Commission and national authorities to ensure that the implementation is done in "a proportionate, transparent, evidence-based and light touch way".
Assessing Indirect Impacts of the EC Proposals for Video Regulation
http://www.rand.org/pubs/technical_reports/TR414/
Television Without Frontiers Directive must protect new media, says Ofcom
(21.09.2006)
http://www.out-law.com/default.aspx?page=7319
EDRI-gram: EU Audiovisual Directive:Budapest Declaration for Freedom of the
Internet (30.08.2006)
http://www.edri.org/edrigram/number4.16/budapestdeclaration