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European Content Quota for Streaming Services to Be Finalized by End of 2019

The European Commission is in talks with the entertainment industry and national authorities to finalize the details of its European content quota for on-demand players.

Amazon and Netflix, the biggest streamers in the European Union, are bracing for the introduction of the 30% quota, but their planning for the new rule is being hampered by a lack of clarity over whether it relates to number of hours, episodes, or some other metric.

The crucial clause in the E.U.’s audiovisual media services directive states that member states “shall ensure that media service providers of on-demand audiovisual media services under their jurisdiction secure at least a 30% share of European works in their catalogues and ensure prominence of those works.”

The European Commission is now in discussions with stakeholders and member states on how that 30% will be calculated. The commission is aiming for the process to be completed and the details made available by the end of 2019.

European rules give member nations 21 months to incorporate an E.U.-wide directive into their national law. In this case, that means they have until Sept. 19, 2020, which will give the streamers less than a year to meet the quota once the details of it are laid out at the end of 2019. Furthermore, the 2020 date is the outside limit: E.U. countries are free to enforce the directive and its 30% provision before that.

The rules apply to on-demand services wherever the hail from. But U.S.-based Netflix and Amazon, by virtue of their size and influence, have been the focus of attention. Both are localizing fast and adding original series from Europe to their slates as part of their wider global expansion.

Erik Barmack, Netflix’s vice president of international originals, said in November that the quota would not have a major strategic impact on Netflix because “our goal is to have more shows out of Europe regardless, because that’s what our members want.” Still, both Netflix and Amazon have a way to go to hit the 30% minimum, and the clock is ticking.

U.K.-based Ampere Analytics tracks the proportion of titles and hours originating from Europe on major streaming services. Its data showed that as of July, going by number of titles, Netflix was only halfway to the 30% quota in France, and Amazon was well below that, at 13%, in Italy.

Netflix and Amazon were tied at 16% in Spain, and registered 17% and 18%, respectively, in the U.K., which is exiting the E.U. but may decide to adopt its rules in some areas. Both U.S. streamers were doing best in Germany, where 19% of the Netflix lineup comprised European-originated titles, and 27% of Amazon’s.

Once the directive is applied locally, E.U. member states will have to report back to the European Commission every two years on their implementation of the law and the 30% content quota.

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