EU Competition Commissioner Neelie Kroes said the media market had changed dramatically in the years since the 2001 legislation.
"Technological advances, particularly digitalisation, are driving convergence. Changing consumption patterns have meant new and modified business models for public and commercial broadcasters alike. And new services have emerged across all media platforms – most obviously the Internet," she said.
Kroes noted that public service broadcasters are uniformly against any change to the existing legal framework, while private media have come together to complain of state aid and demand an updated communication.
EU Information Society and Media Commissioner Viviane Reding has stated that net neutrality is a priority and new network management techniques should not be used for anti-competitive purposes. Measures proposed to reform the telecoms package would protect against abuse of such technologies, she added.
The European Broadcasting Union opposes the introduction of new rules on funding for public service broadcasters, which it says could lead to "harmonisation of PSB regulations".
"The EBU strongly supports member states in their refusal to accept Commission measures which indirectly lead to a de facto European harmonisation of PSB regulations," said EBU Director General Jean Réveillon. He said the EU executive's approach ignores the views of a large majority of member states, which were expressed in writing to EU Competition Commissioner Neelie Kroes.
The EBU believes the current version of the communication published by the Commission is so detailed that it could "reduce the scope for member states to grant public service broadcasters a significant role in the information society".
In a letter sent to Commissioner Kroes, several groups representing the private media industry urge her to resist pressure from national culture ministers "to derail the sensible proposals on state aid to public broadcasters".
The Association of Television in Europe (ACT), the European Publishers Council (EPC), the German Association of Commercial Radio and Telecommunications Providers (VPRT), the European Newspaper Publishers' Association (ENPA), and the European Radio Association (AER) estimate that €22 billion per year is given in state aid to public service broadcasters. This represents a tactical advantage and distorts the market for other entrants, according to the private sector.
This view is echoed in an individual position paper from
highlighting the growing participation of governments in several sectors, and warns that the current financial crisis must not trigger a loosening of state aid rules.
It says the Commission's proposal is a "modest improvement" on the existing text but requires clarification on several points, including the definition and scope of public service broadcasting. The group has also been critical of member states' lobbying for a less detailed communication (EURACTIV, 24/02/09).
(FinnMedia, the federation of the Finnish media industry) called on the Commission to make a clear distinction between public and commercial media.
"Offering pay-services is in conflict with the public service remit. It obfuscates the division between public and commercial service and distorts competition. Therefore offering pay-services either direct or through intermediaries must not at all be included in the public service remit."
The group said the Commission's communication on public service broadcasting must set out clear and precise definitions of what kind of programming supports the democratic, social and cultural needs of society, and at the same time safeguard media pluralism.
The European Publishers Council (EPC), in a letter to Philip Lowe, director General of the Commission's competition arm, stressed that Internet publishing is not simply an extension of the public service broadcasting role.
"The European Publishers Council has been following the increasing tendency of public broadcasters to migrate to the Internet, becoming in many cases, publicly funded newspaper and magazine online publishers, in direct competition with our own web-based services."
The publishers group said it would welcome a clear communication on how state aid rules would be applied to public service broadcasting. "PSB activities on the Internet are not analogous to their pioneering role in conventional broadcasting, and to subsequent market developments," stated the EPC, which also presented a detailed response to the Commission's draft communication in January 2009.
The European Satellite Operators Association (ESOA) took a similar line, suggesting member state support for national media is incompatible with the principles of the EU Treaty and state aid rules.
"In the transition from analogue to digital television, various EU member states tend to favour national technologies based on terrestrial systems over others that are more successful and provide a much larger plurality of services, such as satellite. This leads to the adoption of state aid policies that are often incompatible with the competition principles of the EU Treaty in general, and with EU state aid provisions in particular."
ESOA called on the Commission to take action against national initiatives which fail to respect the 'technology neutrality' principle enshrined in the European regulatory framework on electronic communications.
On the issue of net neutrality, European consumer group BEUC warned against any move that would limit citizens' ability to connect to and communicate on the Internet.
"Consumers care about network neutrality and are deeply concerned about what type of regulation we need to preserve it. Seen from a commercial point of view – and also from a service quality point of view – clearly network neutrality is a stumbling block."
The organisation compared the information superhighway to road infrastructure, which should be open to all. "No democratic societies have yet allowed road authorities, bus or freight operators or taxi companies the right to decide how other agents should access the road network."
Regarding online safety, BEUC called for the protection of children and teenagers' personal data and privacy. Raising awareness about potential threats and protecting against inappropriate marketing to minors should also be a priority, it said.
Open Forum Europe
welcomed the Commission's efforts to tackle net neutrality and opposes any attempt to use traffic management for anti-competitive purposes.
"A key component of the Commission's communication relates to the discussion surrounding a fair, nondiscriminatory, transparent and competitive playing field, the principle that end-users can reach the Internet applications, content, and services they desire on a level playing field, without anti-competitive discrimination on commercial grounds, or restrictions," it said.
Cable Europe, the European Cable Communications Association, said a revision of the Satellite and Cable Directive will help more widespread availability of audiovisual technology in the EU by creating important steps towards a more effective system for rights clearance across the Union.
The British Broadcasting Corporation (BBC) Trust welcomed the general spirit of the draft revision of the 2001 legislation, but described it as "more detailed and prescriptive than necessary".
The European Alliance of Listeners' and Viewers' Associations (EURALVA) reacted positively to the Commission's draft communication, but suggested a clear distinction be drawn between public service broadcasting and state-aided broadcasters. It is also critical of the EU executive's reliance on competition-based criteria in assessing the impact of public service broadcasting.
As part of a public consultation on the draft of the updated Communication on state aid for publicly-funded broadcasters, several governments set out their views:
Bulgaria emphasised the role of member states in defining the public mission of public broadcasters for themselves. "Due to the fact that the organisation, funding and programme content of European public media cannot be unified, then the modification of the communication should comprise only certain basic and flexible principles, but it should not set strict and detailed rules when defining the conditions for conferring services of general economic interest."
expressed concern that the draft communication is too detailed and risks reducing the rights of member states to define the remit of their public service broadcasters.
Ireland cautioned against adopting a "one-size-fits-all" approach to regulating this area. It suggests the language adopting in the draft communication would consign public service broadcasting to history by stating that "the platforms of the future belong to the commercial sector in the first instance".
Sweden believes the draft is too detailed and that the specific examples of commercial activities outlined in the text should be removed.
welcomed several aspects of the Commission's draft communication, but warned against being "too prescriptive" in case this negatively affects member states' ability to ensure public service broadcasters can make a proper contribution to the democratic, social and cultural needs of society.
EEA EFTA States
stated that the basic principles outlined in the 2001 communication are still adequate. Any revision of this should take account of new case law and respect the principles of the Amsterdam Protocol, "notably the principle of subsidiarity".