Questions to Mathieu Moreuil, Head of EU Affairs at Premier League
Commission vice president Andrus Ansip have often said he misses his home country’s football and how that is a reason to make a “digital single market”. So how does football feel about that? Netopia talked to Mathieu Moreuil, Head of EU Affairs at Premier League.
Per Strömbäck: I’m excited, the Swedish football season just started.
Mathieu Moreuil: Yes and you are able to watch it from Brussels! Actually the Swedish games are not geo-blocked. The Swedish broadcaster C-More acquired the rights for the Swedish league in Sweden and agreed with the League to make the games available for viewing outside of Sweden. The reason is simple: the Swedish League has no substantial value outside of Sweden. So they try to increase their coverage and exposure by allowing people outside of Sweden (mainly Swedish ex-pats) to access the content. It is obviously a different strategy for the Premier League or the Bundesliga as they find interest from broadcasters in every EU member state and therefore sell exclusive rights in every member state. Broadcasters then use territorial arrangements such as geo-blocking to ensure they can benefit from these exclusive rights and recoup their investment. For sports, it is rather simple, either you have a local broadcaster and territorial arrangements are used or there is no local broadcaster and therefore normally no geo-blocking.
PS: What is the “Digital Single Market”?
MM: I don’t really know what it means! As far as Premier League and sports in general are concerned, the DSM is difficult to define. For us, Europe is more a combination of markets built on different cultural tastes and preferences. Whether we like it or not, sports remain very national, people like different sports in different countries: they watch different events. The idea of a digital single market is difficult to grasp. Does digital single market mean one digital single demand and one digital single offer? Obviously for us it does not work like that. The Premier League in France, Belgium and the UK are not the same products. Our broadcasters show different games, with different commentaries with special focus on players from their countries etc. We use local broadcasters so the content is tailored to local preferences, to what consumers want. For us the digital single market feels more like ideology than reality. The reality of the EU is a vast cultural diversity which is also an asset and a richness.
PS: Why is football so often used as an example in these discussions?
MM: I think it is very often used because it speaks to people and it seems a concrete and easy example to understand. However, people who use these examples very often simply do not describe what the situation is. I’m going to give you three examples.
When Vice President Ansip mentions he cannot get access to Estonian football, I am not sure it is actually the case. The Estonian league is broadcasted by the Estonian Public Service Broadcaster and a lot of that broadcaster’s content is available non-geo-blocked on their internet streaming service.
Commissioner Öttinger said in his speech at the #Digital4EU-conference, that he does not understand why you cannot watch the Chelsea-Liverpool game in Belgium. Of course you can watch Chelsea v Liverpool in Belgium! It was on our two Belgian broadcasters. Yes in Belgium, we have two licensees because Belgium is not one single market, people do not speak the same language and consumers want commentaries in their own languages. So that Chelsea v Liverpool match is definitely available in Belgium and tailored to the Belgian audience with a strong focus on the three-star Belgian players Simon Mignolet, Thibault Courtois and Eden Hazard. The English version of the same game, from BSkyB or BT (our licensees in the UK) is not available on the internet in Belgium because there are Belgian broadcasters who acquired the Belgian rights.
Finally my favorite one, Robert Madelin, Director General of DG Connect responsible for the DSM, mentioned in an interview to Euractiv back in September that Maltese consumers cannot legally access the Premier League in Malta and “cry into their beer”. Actually it takes ten seconds on the internet to find out that we do have an official licensee there, called Go Malta, which acquired the rights.
To cut a long story short, people who use these examples about football are usually not the ones watching the games. The content is there, believe me! Of course, there will always be something that is not available, like maybe second division Finnish ice-hockey. But the vast majority of the most popular sports events are available, either through traditional or online broadcasters or through a combination of both.
PS: But don’t expats want to use the services they are familiar with?
MM: Sure, but when expats arrive in Belgium they have to pick a new bank, get a new insurance for their apartment or their car, a new mobile phone contract. That is part of the exciting experience of living abroad. We expats are 3% of the EU population according to the latest Eurostat-numbers. If you take the Belgian example, you have on the one hand ten million Belgians potentially interested in the Belgian service for the Premier League, on the other hand less than half a million UK expats interested in the UK service for the Premier League. So the market solution to this equation is not difficult to find. Also if you cannot provide your broadcasters with territorial exclusivity anymore, there is a risk that the availability of offers will be limited in the future. At the moment we sell our Premier League content in the UK for approximately £1 billion per year. If I take the 27 other member states put together, it hardly reaches €150 million. The value is very different in the home market and in other markets, it’s a 10 to 1-ratio. If I take the example of the French Football League, the ratio is even bigger, €700 million in France and €7 million in the 27 other member states. So if you cannot provide your licensees on your main market with exclusive rights (i.e. if there is a risk customers subscribe to other services elsewhere) the logical answer then would be to stop selling outside the home market. For instance the French Football League might decide not to sell their content anymore in Belgium, if there is a risk that French citizens subscribe to the Belgian offering. The Belgian citizens would have to get the French subscription which is more expensive and not tailored to their tastes. So the whole cross border access thing is a bad idea for consumers because it could mean less content available at a more expensive price.
PS: The UK price point would be the norm across Europe?
MM: Yes, the same could happen with the Premier League. The risk is that you will end up with only the home market subscription, not tailored to local preferences and at a higher price than before. UK ex-pats will be happy but Belgian football fans may be frustrated. This would not help the image of the EU. The value of the sporting content is not the same everywhere, this is simply not the case.
PS: How do you expect the DSM to influence growth and jobs in Europe?
MM: In our sector, it will not create any additional jobs or growth. If you cannot deliver what the market wants, i.e. territorial licensing, if you have to sell on pan-European basis, the biggest broadcasters – whether that is television or internet – will get all of the content. There will be less competition at national level and at EU level. At the moment, a small Estonian broadcaster can acquire the rights to Premier League and package a nice, attractive offer probably combined with other sports or other audio-visual content to serve consumers in Estonia. So there is a competitive market at national level. Broadcasters invest in the content, get advertising revenues, subscription revenues, there is a whole economy around it. If tomorrow you are not able to use territorial arrangements and therefore you have to sell on pan-European basis you might end up with competition for Premier League in the UK market only which effectively becomes the EU market. So no opportunities for local broadcasters anymore, less competition overall. It is actually totally in contradiction to what the EU competition law is trying to achieve. It would only favour the big guys. You should ask local broadcasters what they think about these ideas of banning geo-blocking, I can tell you they are not happy about that.
PS: What is the difference between portability of services and cross-border access?
MM: As I said, it seems very risky for the Commission to ban geo-blocking and make cross-border access compulsory through passive sales. It is a big gamble in terms of jobs and growth to challenge a licensing regime which works well for sports and for the broadcasting sector. There are not so many sectors where Europe is actually world leader and sport is one of them.
However, we are aware of the issue faced by European citizens traveling for a short period of time in another EU Member State for business trips or holidays, when their subscriptions cease to function. This is something we are ready to discuss with the European Commission and our licensees. If a UK citizen go to Spain for two weeks holiday, he or she you should still be able to watch the Premier League games he or she subscribed to. We at the Premier League understand that and we want to address it. It is not as straight forward as people might think especially when it comes to sport content which has to be sold on free-to-air broadcasters by law, but we can certainly discuss with our licensees and find a solution to ensure the portability of lawfully acquired content. It would involve conditions of residence though otherwise it is just cross border access by the back door.
To cut a long story short, we say to the Commission, be careful what you wish for. If you want to ban all territorial arrangements, the situation that we have now with local broadcasters everywhere in Europe will not remain. If you change the conditions by which we sell the content, the end result will be different and you might end up with less choice, higher prices, maybe happy ex-pats but frustrated consumers.
Full disclosure: Premier League is one of Netopia’s sympathisers. (full list here)
