France

[FR] Analysis of the effects of regulation on on-demand AVMS

IRIS 2017-1:1/16

Amélie Blocman

Légipresse

The national audiovisual regulatory authority in France (Conseil Supérieur de l’Audiovisuel - CSA) has published a study, conducted by French media research institute IDATE, on the economic effects of Decree no. 2010-1379 of 12 November 2010 concerning on-demand audiovisual media services (AVMS). The study assesses the current range of pay-per-view video-on-demand (VoD) and subscription video-on-demand (SVoD) services available in France (economic models and consumption) in order to weigh up the decree’s effects on the development of the video-on-demand market in France.

The study analyses the Decree’s impact on the prominence given to and financing of audiovisual and cinematographic works by on-demand AVMS. The Decree (Art. 13) requires such services to ensure that European works and works made originally in the French language are present and given prominence on their home page and in their catalogue. These obligations apply to AVMS with catalogues containing at least 20 cinematographic or audiovisual works. However, the study found that, in contrast to SVoD, the real impact of these obligations on the actual consumption of European and French-language content is questionable where pay-per-view VoD services are concerned, since very few users access these services through the relevant home page. As a result, the viewing choices of only a small minority can be influenced by what is displayed there. The decrees’ provisions on the proportion of European (60%) and French-language works (40%) in catalogues appear to be having a satisfactory effect, although ensuring and monitoring fulfilment of the obligation to respect these quotas “at all times” seems unrealistic, since the content of these catalogues changes very frequently in accordance with commercial agreements and the availability of works.

The CSA study also analyses how the Decree has affected the industry’s contribution to audiovisual and cinematographic production, with on-demand AVMS that generate net annual turnover of more than EUR 10 million subject to investment obligations. According to the IDATE, the Decree’s impact in this area is debatable for several reasons. First, the number of services that exceed the turnover threshold is very small (only 4 out of 124 in 2012). Secondly, providers of on-demand AVMS who are subject to production obligations meet their obligations solely by purchasing rights. To date, no French-based provider of on-demand AVMS has become involved in prefinancing since this is heavily linked to exclusivity, which is not part of the current business model of pay-per-view VoD services.

Therefore, the study concludes that the Decree does not seem capable of producing any visible effects on the prefinancing of French and European audiovisual and cinematographic production.

Finally, after a comparison with other European markets, the study describes a trend scenario based on legal perimeters remaining constant, as well as a number of variants that could result from the amendment of one or more aspects of the legal framework governing on-demand AVMS.