Online content: European policy and regulation in a global market

Citation

Van Audenhove, L., Constantelou, A. and Poel, M. (2011), "Online content: European policy and regulation in a global market", info, Vol. 13 No. 6. https://doi.org/10.1108/info.2011.27213faa.001

Online content: European policy and regulation in a global market

Article Type: Guest editorial From: info, Volume 13, Issue 6

A “vibrant digital single market” has been one of the priorities of the Digital Agenda for Europe launched in May 2010. Online content services represent a significant part of the European digital market and, as such, have been found at the heart of the European policy debate. By online content services we normally refer to traditional and new media-like services (news services, blogs, wikis), user-generated content (UGC), and social networking. A single European market for online content is perceived crucial for European competitiveness and growth. Although European firms may benefit from national markets, as a result of reduced competition and national pricing strategies, it is also the case that firms suffer from the fragmentation of Europe’s markets, e.g. because it limits scale advantages vis-à-vis their large and innovative American counterparts. In many respects, the reality of fragmented content markets illustrates the diversity of Europe’s cultures, languages and policy priorities.

According to the OECD (2007), the rapid growth of these services over the past few years has been due to a range of technological, social, economic, and institutional factors, the most prominent of which are:

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  the increased availability of broadband infrastructure;

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  the availability of more powerful and less costly hardware capacity and of more accessible software tools;

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  the changing media production and consumption habits of internet users, irrespective of their age and social status;

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  the proliferation of new methods and new actors involved in the creation and distribution of online content, as well as, the greater availability of investment resources to finance them; and

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  the development of new legal instruments (e.g. The Creative Commons licence scheme) that have reduced the barriers to further exploitation of the content produced.

From a social scientist’s perspective, online content services – and the associated actors, technologies, markets, etc. – are seen as part of a constellation of interconnected technologies and systemic innovations that take place within the broader context of the ICT revolution. With ICTs being essential for ever more economic activities, a new techno-economic paradigm is currently unfolding (Freeman and Perez, 1988; Perez, 2002), whose implications extent far beyond the economic realm. Economic implications such as new market structures, new business models, new sectors and changes in the geographic location of economic activities, interact with social and cultural changes and changes in policy and regulation. For example, international firms that provide social networking services enable social contact around the globe and give rise to new ways and methods of user interaction. At the same time, existing rules governing online relations and transactions are increasingly insufficient in the context of new online content services and markets. Online content also raises important social and cultural issues. For example, social networking can empower consumers and citizens, while raising important privacy concerns.

Online content was the theme of the 26th European Communications Policy Research Conference (EuroCPR) that took place in March 2011 in Ghent, Belgium. The main characteristics and the increased importance of online content services were analysed from legal, social-cultural and economic angles. The implications for policy and regulation were an important element of the papers and subsequent discussions.

The collection of articles in this special issue of info allows for an illustration of (and reflection upon) some of the critical elements that the shifting of ICT-driven techno-economic paradigm unravels, as exemplified in the case of online content services. During this transition phase, the various actors (be they individual users, technology suppliers, value chain mediators, policy makers, etc.), through their discrete choices and actions, have the power to create the conditions for subsequent changes in the structures of prevailing systems (economic, social, legal and regulatory), thus shaping the appropriation of technological developments. The common underlying theme that underpins all papers in this special issue is the illustration of the particular ways in which these actors interfere and take action.

More specifically, the papers provide theoretical argumentation and empirical evidence regarding the changing landscape in online content services that falls within three broad areas:

1. 1.

   the economic area, whose primary concern is to investigate changes in business models, new market structures and sectors;

2. 2.

   the social-cultural area, where issues related to intellectual property rights (IPRs), security, privacy and content quality are raised, and

3. 3.

   the policy and regulatory area, where issues related to the capacity of existing rules and regulations to protect citizens and create legal certainty for firms and public organisations are addressed.

In what follows we briefly elaborate on these themes mapping the articles and the topics presented in this special issue.

New market structures, business models and sectors

The introduction of the internet and digitization of the content industry have lead to fundamental changes in market structures and business models. A general discussion of these developments would lead us too far. However, different articles presented in this edition throw a special light onto the subject. In their article on “Social networks, legal innovations and the ‘new’ music industry”, Rogers and Preston question the current rhetoric on the crisis of the music industry. The music industry is often portrayed as the content sector par excellence that has seen its business models undercut by copyright infringements. However, Rogers and Preston contend that the music industry has been highly innovative in responding to the challenges of digitization. The industry has evolved from an industry centred on the private sale of products to one built on the exploitation of rights, mainly through licensing. According to the authors, related activities in this sector are increasingly streamlined under a central power, whereby revenue channels deriving from activities across all sub-sectors increasingly lead back to one corporate entity. The dominant belief that social networking and the Internet would lead to major innovation and new possibilities for individual aspiring artists is therefore seriously questioned.

Kathleen Janssen’s article treats a totally different type of content, i.e. public sector information (PSI) in the European information market. Governments and public bodies hold large quantities of data that can be an important source for innovative online services. The potential of new services based on these data has grown drastically by the development of web 2.0 and new technologies. In 2003, the EU adopted a PSI directive to stimulate the European information market. It has developed a complex set of rules and conditions aimed at creating a level playing field between public and private actors in the field avoiding unfair competition. Yet, reviews reveal that the impact of the directive is still unclear. Furthermore experts hold that the full potential of PSI has not been achieved. What is interesting is that a radically new business model generally referred to as “open government data” (OGD) provide new hope to open up government data for re-use. Under OGD, data is open to the use by the public, whether commercial or non-commercial, under non-restrictive conditions and very limited requirements. Whereas PSI is still informed by old style competition and private initiative, OGD seems more closely related to ideas of user generated content and bottom-up innovation, which could stimulate faster innovation in this area. In the article the author sets out how PSI and OGD could be more integrated.

In their article on “Social media and cookies: challenges for online privacy”, Jo Pierson and Rob Heyman remind us that, similar to traditional media and their audiences, social media generate users that can be sold to advertisers. Unlike traditional media, however, social media allow for the commodification of individual behaviour and social relations, by using this type of information for a more personalised commercial communication and the promotion of specific goods and services. Most of the business models related to social media and user-generated content are based on this principle. Put simply, the commodification of individual expressions is becoming a lucrative business.

Changes in the social-cultural context: new norms and routines?

All articles in this special edition of info start from observations about technological change and their relation to social change. New media and the Internet have become an integral part of everyday life in major parts of Europe and more generally in Western society. All papers pay attention to recent developments related to social media, user-generated content and aspects of mass-self communication. Indeed, in the past five years the popularity of social network sites has exploded, attracting extraordinary numbers of users. These social network sites are used both by youngsters, adults and professionals. They provide innovative features and services, but also harbour new risks and problems. What is striking is that four out of the six papers presented in this issue are related to protection of certain groups in society or with privacy issues. At the EuroCPR conference multiple sessions were devoted to these topics. Both researchers and policy makers consider these issues to be central to many of the policy discussions in the future.

Eva Lievens in her article on “Risk-reducing strategies for protecting minors in social networks” starts from the observation that, aside from providing greater access to certain (illegal and harmful) categories of content and the facilitation of certain behaviour such as cyber-bullying and grooming, an added complexity can be found in the transforming role of minors, from passive consumers/victims to active contributors/perpetrators. The author notes that, so far, research into the legal impact of content and conduct risks that occur in a specific social network context and the regulatory instruments that can be used to address these risks has been rather rare. Lievens discusses recent trends in this fields and analyses recent regulatory initiatives. She goes on to discuss alternative regulatory instruments and their compliance with the broader legal framework.

What is interesting in the case of minors is that there is probably broad societal support on the need for regulatory intervention in this area. This might not be the case for privacy, which is the subject of the other articles. Especially youngsters and young adults do not seem to mind the blurring of public and private spheres. Many people do not mind that personal information is used as a currency in social networking and web 2.0 services. The uneasy question arises as to whether we need to regulate something people do not seem to care about. As Jo Pierson and Rob Heyman indicate in their article, commercial use of personal data does not have to be problematic as such. There can be a fair deal between the user and the digital service, as long as each party in the deal clearly understands the transactional terms. In reality however, users and consumers are often unaware how and in what context their information is gathered and used. In their article they use Nissenbaum’s (2004) framework on “contextual integrity”, to assess whether and when the use of personal information in social media contexts can be considered fair. They apply the framework to cookies.

Changes in policy and regulations: new rules for a new context?

Market trends are challenging nearly every definition, policy and regulation for online media. As audiovisual, music and other content services move online, demarcations within and between media and personal communication services and between platforms blur. Online content cuts across dichotomies such as open – closed, linear – interactive, professional – amateur, public – private, mobile –fixed and national – global. Issues around copyright, standards and interoperability have become critical for the availability and use of online content. What is striking in the different articles of this special issue is that authors explicitly state that the issues at hand cut across different policy and regulatory fields. In her article on risks related to social networks, Eva Lievens points out that the classification of risks that have been identified in relation to minors using social networks spans many different legal disciplines. Furthermore, in different articles the solutions and ways forward for policy and regulations are diverse and often alternative to classical regulatory solutions. Eva Lievens defines in her article guidelines for the creation of efficient risk-reducing regulatory strategies for the protection of minors in online social networks. Helberger et al., in their article on “Standardizing consumer’ expectations in digital content”, map initiatives and options to create defaults of reasonable digital consumer expectations. Kathleen Janssen explores how the PSI directive can be complemented or/and integrated with Open Government Data initiatives.

Apart from classical policy and regulation many authors have pointed to the fact that ICTs, devices, networks and standards are not neutral. The architecture of technology and networks increasingly regulate human behaviour in our information society (Lessig, 2006; Mueller, 2010). Two articles in this special edition specifically illustrate regulation by “code”.

The article by Marc van Lieshout et al., “Privacy by design: an alternative to existing practices in safeguarding privacy”, explores how protection of privacy can be integrated into the design of ICT systems. The authors bring together several contemporary insights on privacy protection and privacy by design. They subsequently develop a holistic framework for privacy by design consisting of different building blocks. Although the authors hold that a privacy-by-design approach could offer surplus value in better safeguarding privacy without losing functional requirements, the implementation is not easily realised and is confronted with several difficulties.

The article by Natali Helberger focuses on the protection of consumers in relation to digital content. New content services – certainly when based on new devices – often result in a lack of a clear notion of which product characteristics are still reasonable to be expected by users. Technical compatibility or the conscious lack thereof, the use of digital rights management limiting the ability to play, copy and forward digital content, blocking of access to content across national borders, can introduce new barriers into the consumption and experience of digital content. Although interoperability is an important focus in the Digital Agenda, Helberger shows that standardization and securing a certain level of consumer expectations is not clearly guaranteed.

The Digital Agenda for Europe addresses these policy issues, many of which were originally discussed in the 1997 Green Paper on convergence. Since then, market and regulatory developments have cast a new light on these issues. The Commission has announced a number of new initiatives, which will critically define the shape of European online content markets, and the role of European players in global markets. However, what this special issue clearly shows is that the ICT paradigm shift is a continuous process, taking place in phases. We have moved from an early internet that merely functioned as a new distribution channel for existing – mainly textual – content, through a more mature internet in which the internet became a full distribution channel of cross-channel content provisions, to an internet that integrates existing content production and distribution with user generated content and mass-self communication. It has become obvious that policy and regulation are not always able to come to grips with these evolutions. Although the Digital Agenda sets out a new framework for digital content in Europe, many of the more specific policy areas are not yet equipped to deal with the new challenges that social networks and user generated content put forward. These remain fruitful research areas for social scientists, policy analysts and legal scholars, who have a lot to contribute.

Leo Van Audenhove, Associate Professor at the Department of Communication Studies at the Vrije Universiteit Brussel, Brussels, Belgium.

Anastasia Constantelou Assistant Professor at the Department of Financial and Management Engineering, University of the Aegean, Chios, Greece

Martijn PoelSenior Researcher at TNO, Delft, The Netherlands.

About the Guest Editors

Leo Van Audenhove is Associate Professor at the Department of Communication Studies at the Vrije Universiteit Brussel. He is the Program Director of the English language Master of Communication Studies – New Media and Society in Europe. He lectures on international communication, the information society, comparative communication, policy analysis and internet governance. He is Senior Researcher at the Centre for Studies on Media, Information and Telecommunication, a research institute that forms part of the Interdisciplinary Institute on Broadband Technologies of the Flemish Community. Between 2001 and 2004 he worked part-time as a researcher/advisor at TNO-STB in Delft, The Netherlands. In the context of TNO in The Netherlands and IBBT in Flanders he has led multiple large research projects in collaboration with different partners from industry, government and universities. His research interests are information society policy, internet governance and e-inclusion policy. He has published widely in international journals such as Third World Quarterly, International Review on Education, Communication, Political Communication, Gazette, etc. and has co-authored two books on the digital divide.

Dr Anastasia Constantelou is Assistant Professor at the Department of Financial and Management Engineering, University of the Aegean. She holds a BSc in Informatics and Telecommunications from the University of Athens (1990), an MSc in Technology and Innovation from Science Policy Research Unit, University of Sussex (1992) and a PhD in Science and Technology Policy Studies from the University of Sussex (1998). She has been a consultant to the OECD on telecommunications regulatory aspects in European periphery and on issues related to telecommunication numbering. She has also worked as an independent consultant to communication-related projects in Greece and abroad. She has been Research Associate at the Laboratory of Industrial and Energy Economics, and Researcher at the Institute of Communication and Computer Systems (ICCP), both at the National Technical University of Athens. Her research interests focus on e-business strategy and implementation and on innovation management and technology policy. She was a member of the Organizing Committee of the Greek E-Business Forum – an initiative established under the auspices of the Ministry of Development. Since 2007, she has been a member of the Programme Committee of the European Communications Policy Research (EuroCPR) Conference. Anastasia Constantelou has published widely in highly ranked scientific journals and has made several presentations in international academic conferences.

Martijn Poel is Senior Researcher at TNO. He specialises in innovation policy and information society policy. Research topics include the competitiveness of Europe’s ICT sector, innovation in online media, services innovation, impact assessment of R&D programmes, and the interaction between policy instruments (the policy mix). At the Delft University of Technology he is conducting research on internet video. Martijn Poel worked in international consortia for the European Commission – DG Enterprise and Industry and DG Information Society and Media – and the Institute for Prospective Technological Studies (JRC-IPTS). He worked in 20+ projects for the Dutch Ministry of Economic Affairs. He was chair (2009-2011) of the EuroCPR Conference, a network of researchers and policy makers in information society policy. He holds a masters degree in Communication Science from the University of Amsterdam. He took economic courses at the Erasmus University Rotterdam and legal courses at the Institute for Information Law (University of Amsterdam).